x Annual report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934



Commission File Number: 0-22269







|Louisiana                         | 72-1341014              
|--------------------------------- | ------------------------
|(State or Other Jurisdiction      | (IRS Employer ID Number)
|of Incorporation or Organization) |                         









Registrant's Telephone Number: (504) 457-6220







Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing requirements
for the past 90 days.



|x Yes | No
|----- | --

Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of the Registrants knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. ____



As of March 8, 2001, there were 1,938,646 shares of the Registrants
common stock, par value $.01 per share, issued and outstanding.
The aggregate market value of such stock, excluding the shares
held by all directors and officers of the Registrant, was $20.5
million at March 8, 2001 based on the per common share price at
closing of $14.63 on that date. The information presented in this
Form 10-K at December 31, 2000 and 1999, and for the twelve months
ended December 31, 2000, 1999, and 1998 represent the financial
condition and results of operations of GS Financial Corp. and
its wholly-owned subsidiary, Guaranty Savings & Homestead
Association.

DOCUMENTS INCORPORATED BY REFERENCE

Listed hereunder are the following documents which have been
incorporated by reference and the Part of the Form 10-K into which
the document is incorporated.



|(1) | Portions of the Annual Report to Shareholders for the fiscal
    year ended December 31, 2000 are incorporated into Part II, Items
    5 through 8, and Part IV, Item 14.                                              
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Portions of the definitive proxy statement for the 2001 Annual
    Meeting of Shareholders to be filed within 120 days of the Registrants
    fiscal year end are incorporated into Part III, Items 10 through
    13.







Item 1 of the Form 10-K is hereby amended and restated in its
entirety to read as follows:

Item 1. BUSINESS

In addition to historical information, this Annual Report on
Form 10-K includes certain "forward-looking statements,"
as defined in the Securities Act of 1933 and the Securities Exchange
Act of 1934, based on current management expectations. The Companys
actual results could differ materially from those management expectations.
Such forward-looking statements include statements regarding the
Companys intentions, beliefs or current expectations as
well as the assumptions on which such statements are based. Stockholders
and potential stockholders are cautioned that any such forward-looking
statements are not guarantees of future performance and involve
risks and uncertainties, and that actual results may differ materially
from those contemplated by such forward-looking statements. Factors
that could cause future results to vary from current management
expectations include, but are not limited to, general economic
conditions, legislative and regulatory changes, monetary and fiscal
policies of the federal government, changes in tax policies, rates
and regulations of federal, state and local tax authorities, changes
in interest rates, deposit flows, the cost of funds, demand for
loan products, demand for financial services, competition, changes
in the quality or composition of the Companys loan and investment
portfolios, changes in accounting principles, policies or guidelines,
and other economic, competitive, governmental and technological
factors affecting the Companys operations, markets, products,
services and fees. The Company undertakes no obligation to update
or revise any forward-looking statements to reflect changed assumptions,
the occurrence of unanticipated events or changes to future operating
results over time.



General

GS Financial Corp. (the "Company") was incorporated
under Louisiana law on December 24, 1996 as a thrift holding company.
The Company commenced operations on April 1, 1997 upon the completion
of its initial public offering of common stock, which trades on
the Nasdaq National Market. On that date the Companys wholly
owned subsidiary, Guaranty Savings and Homestead Association (the
"Association") was converted from a Louisiana chartered
mutual savings and loan association to a Louisiana chartered stock
savings and loan association. This was accomplished through the
offer and sale of common stock by the Company to certain depositors,
employees, officers and directors of the Association as well as
the GS Financial Employee Stock Ownership Plan (the "ESOP").
The Company simultaneously used a portion of the proceeds of its
sale of common stock to acquire 100% of the stock of the Association.

The Company's principal business is conducted through the Association.
Guaranty Savings and Homestead Association was founded in New
Orleans, Louisiana in 1937 as a mutual savings and loan association.
The Associations unconsolidated assets at December 31, 2000
totaled $151.2 million and comprise 98.5% of the total consolidated
assets of the Company. The Association provides financial services
primarily to individuals, mainly through the origination of mortgage
loans on 1-4 family residences. The Association accepts deposits
in the form of passbook savings, certificates of deposit, demand
deposit accounts and individual retirement accounts. The Association
also invests in short and long term liquid investments such as
US Treasury and Agency securities, mortgage backed securities,
overnight Federal Funds, money market investments and qualified
thrift grade mutual funds. The balance of the consolidated assets
includes $2.0 million in similar short and long term liquid investments,
and $.3 million in fixed assets held exclusively at the Company
level.

Regulation

The Companys primary regulator is the Office of Thrift
Supervision ("OTS"). The OTS regulates all thrifts and
thrift holding companies whose deposits are insured by the Savings
Association Insurance Fund ("SAIF") which is administered
by the Federal Deposit Insurance Corporation ("FDIC").
The Company, by virtue of its state charter is also subject to
the rules and regulations of the Louisiana Office of Financial
Institutions ("OFI"). These two agencies currently examine
the Company approximately every 18 months on an individual basis,
relying on the examination report of the other agency on cycles,
alternating when it is not their year to examine the Association.
The nature of such examinations includes safety and soundness
issues or compliance with applicable laws and regulations. The
Association was last examined by the OFI as of September 30, 2000
and the Company was last examined by the OTS as of June 30, 1999.

As a public registrant the Company is subject to the rules
and regulations of the Securities and Exchange Commission ("SEC").
The Company also is subject to the rules of the NASDAQ Stock Market.

The Association has been a member of the Federal Home Loan
Bank of Dallas ("FHLB") since 1937. The Federal Home
Loan Bank System is comprised of 12 regional banks which serve
thrifts and banks by offering investment opportunities and sources
of funds.

Lending Activities

Loan Portfolio Composition. The following table sets
forth the composition of the Companys loan portfolio by
type of loan at the dates indicated (in thousands):





|                   |                        |                         |       | December 31,
|------------------ | ---------------------- | ----------------------- | ----- | ------------
|                   |                        |                         |       | 2000        
|Real Estate Loans: |                        |                         |       |             
|                   | One to Four            |                         |       |             
|                   |                        | Family Residential      | $     | 71,092      
|                   | FHA and VA             |                         | 52    |             
|                   | Construction           |                         | 619   |             
|                   | Commercial Real Estate |                         | 1,006 |             
|                   | Other                  |                         | 1,453 |             
|                   |                        |                         |       | ---------   
|                   |                        | Total Real Estate Loans |       | 74,222      
|                   |                        |                         |       |             
|Consumer Loans:    |                        |                         |       |             
|                   | Second Mortgage        |                         | 52    |             
|                   | Loans on Deposits      |                         | 237   |             
|                   |                        |                         |       | ---------   
|                   |                        | Total Consumer Loans    |       | 289         
|                   |                        |                         |       |             
|Commercial Loans   |                        | 381                     |       | -           
|                   |                        |                         |       | ---------   
|                   |                        | Total Loans             |       | 74,892      
|                   |                        |                         |       |             
|Allowance for      |                        |                         |       |             
|                   | Loan Losses            |                         | (420) |             
|                   |                        |                         |       |             
|Net Deferred Loan  |                        |                         |       |             
|                   | Origination Costs      |                         | 8     |             
|                   |                        |                         |       | ---------   
|Net Loans          | $                      | 74,480                  | $     | 70,066      
|                   |                        |                         |       | =====       

Contractual Term to Final Maturities.The following
table sets forth certain information as of December 31, 2000 regarding
the dollar amount of loans maturing in the Companys portfolio,
based on the contractual date of the loans final maturity,
before giving effect to net items. Demand loans and loans having
no stated maturity are reported as due in one year or less. The
amounts shown below do not reflect normal principal amortization;
rather, the balance of each loan outstanding at December 31, 2000
is shown in the appropriate year of the loans final maturity.
The actual maturity of loans varies primarily on prepayments which
to a large extent depends on market interest rates. In general
if prevailing market rates fall below those of the portfolio,
prepayments accelerate. Conversely if market interest rates increase
above portfolio rates early pay-offs tend to decrease.



Fixed rate loans receivable as of December 31, 2000 are scheduled
to mature and adjustable rate loans are scheduled to re-price
as follows (in thousands):



|                            |              |     | Under 
    One 
    Year | One to 
    Five 
    Years | Over Five to Ten Years | Over 
    10 
    Years | Total 
|--------------------------- | ------------ | --- | ------------------------ | --------------------------- | ---------------------- | ----------------------- | ------
|                            |              |     | ------                   |                             | ------                 |                         | ------
|Loans Secured by 1-4 Family |              |     |                          |                             |                        |                         |       
|                            | Residential: |     |                          |                             |                        |                         |       
|                            | Fixed Rate   | $   | 65                       | $                           | 2,054                  | $                       | 9,740 
|Other Loans Secured by      |              |     |                          |                             |                        |                         |       
|                            | Real Estate: |     |                          |                             |                        |                         |       
|                            | Fixed Rate   |     | 32                       |                             | 111                    |                         | 331   
|Commercial Fixed Rate       |              | 99  |                          | -                           |                        | -                       |       
|All Other Loans             |              | 237 |                          | -                           |                        | -                       |       
|                            |              |     | ------                   |                             | ------                 |                         | ------
|                            |              | $   | 433                      | $                           | 2,165                  | $                       | 10,071
|                            |              |     | =====                    |                             | =====                  |                         | ===== 

Loan Origination Activity. The table below sets forth
the Companys total loan origination and reduction experience
during the periods indicated. Historically, the Company has not
purchased or sold any loans.



|                                  |                        |        | December 31,
|--------------------------------- | ---------------------- | ------ | ------------
|                                  |                        |        | 2000        
|                                  |                        |        | -------     
|Loan Originations (in thousands): |                        |        |             
|                                  | 1-4 family residential | $      | 10,846      
|                                  | Construction           |        | 1,514       
|                                  | Commercial real estate |        | 323         
|                                  | Consumer               |        | 106         
|                                  | Commercial             |        | 383         
|                                  | Other Real Estate      |        | 568         
|                                  |                        |        | -------     
|Total Loan Originations           |                        | 13,740 |             
|Loan principal                    |                        |        |             
|                                  | repayments             |        | (9,218)     
|Increase (decrease)               |                        |        |             
|                                  | due to other items     |        | 6           
|                                  |                        |        | -------     
|Net increase(decrease) in         |                        |        |             
|                                  | Loan portfolio         | $      | 4,528       
|                                  |                        |        | ======      

Real Estate Lending Standards and Underwriting Policies.
As of March 19, 1993, the Company was required to adopt and maintain
written real estate lending policies that are consistent with
safe and sound banking practices. The Company is in compliance
with all such standards.

The lending activities of the Company are subject to written
underwriting standards and loan origination procedures established
by the Company's Board of Directors and Management. These standards
and procedures are incorporated into the Company's Underwriting
Standards and Lending Policy which are reviewed annually by the
Board of Directors (the "Board"). The underwriting standards
dictate the manner in which loan applications are accepted and
processed. Such standards are written to comply with all applicable
laws and regulations including but not limited to Truth-In-Lending
(Regulation Z) and the Real Estate Settlement and Procedures Act
("RESPA"). These standards pertain to such issues as
appraisal guidelines, disclosure requirements, credit criteria,
complete applications, and title requirements. The Company requires
appraisals from Board-approved state licensed and certified appraisers.
The lending policy establishes the overall direction of the Company's
lending activities within the community and forms the basis for
setting underwriting standards which limit the Company's exposure
to credit risk. Such factors include loan amount, debt to income
ratios, collateral, and acceptable rates and terms.

Briefly stated, the loan process consists of applicants meeting
with loan personnel and providing pertinent documentation, including
but not limited to, requested loan amount, property description,
security offered as collateral, intended down payments and an
acceptable rate and term consistent with the Company's then current
lending policy. Upon receipt of a favorable credit report, an
appraisal is obtained with requisite documentation to support
the property's stated market value. Upon completion the loan package
is presented to the Loan Committee for consideration. All applicants
receive written notification of the Committees decision
to approve or deny the request. Approved loans are assigned to
one of the Company's approved attorneys for closing. Actions of
the Loan Committee are submitted to the Board of Directors for
consideration and ratification on a monthly basis.

Loan applications are accepted at all three of the Companys
offices and forwarded to the Loan Committee which meets weekly.
The Company requires a title insurance policy on all loans prior
to closing.

The Companys loan portfolio consists of conventional
fixed rate mortgage loans on 1-4 family residential dwellings.
The terms of these go up to 30 years. Currently, the minimum cash
down payment is 20% of the lesser of purchase price or appraised
value. The Company also makes loans on residential investment
property, commercial real estate, condominiums and vacant ground.
Terms and rates are commensurate with current market conditions
and risk factors.

The Company originates and funds construction loans which subsequently
convert to permanent, fixed rate mortgage loans. During the construction
period, the company requires payment of interest only on the amount
of principal drawn.

During 2000, the Company began offering commercial loans. These
include loans secured by commercial real estate, inventory, equipment
or receivables. These loans provide the Company an opportunity
to offer additional services, attract new business and diversify
its loan portfolio.

Loans are available to depositors of the Company secured by
passbook savings or certificates of deposit at a rate 2 percentage
points above the savings rate up to 90% of the face amount of
a certificate of deposit or 90% of the current available balance
of a passbook. The minimum amount on such loans is $1,000 and
these loans are payable on demand subject to 30 days notice.

Asset Quality

General. The Company has adopted an asset classification
policy which is designed to draw attention to assets before collection
becomes a problem, thus maintaining the quality of the Companys
investment as an interest earning asset. The policy also insures
the accurate reporting of the Companys assets from a valuation
standpoint.

All of the Companys assets are reviewed on a quarterly
basis. Payment histories as well as the value of the underlying
collateral are reviewed and assessed in light of several risk
factors. The most significant risk factor is the state of the
local economy. A healthy economy is characterized by low unemployment
which usually leads to strong real estate markets and the maintenance
if not appreciation of underlying collateral values. Current interest
rates and expectations of the movement thereof is also a significant
risk factor. Low or falling interest rates can act to stimulate
local real estate markets while also increasing prepayment speeds
on existing assets. Rising or high interest rates usually slows
down payments. The level of credit concentration the customer
has with the Company is also a risk factor. Other risk factors
include environmental factors which could impair the value of
the underlying collateral of an asset or changes in federal and
state regulations which might reduce the ability of the Company
to collect all of the principal and interest owed to the Company.

The Companys Watch List, comprising substandard and special
mention assets is presented to the Board quarterly. Assets displaying
tendencies which might hinder full collection of principal are
classified as substandard. Such tendencies include but are not
limited to late payments on loans or deterioration of the underlying
collateral. Those loans classified substandard, for which a specific
potential for loss has been identified, are considered "special
assets." Assets classified as special mention are those not
yet serious enough to merit the substandard classification but
do require additional attention from management.

Loan collection efforts in the form of past due notices commence
when loan payments are more than 15 days past due. Once a loan
reaches 30 days past due status, the Companys collection
manager initiates personal contact with the borrower. When a loan
becomes 90 days past due, the Company initiates foreclosure proceedings.
At this point, loans are placed on non-accrual status. All interest
and late charges due on such loans are reversed in the form of
reserves for uncollectible interest and late charges.

Real estate acquired by the Company through foreclosure is
classified as foreclosed real estate until such time as the property
is sold. All such assets are booked at the lower of appraised
value or cost which includes all principal, escrow overdrafts
and attorney fees. All Foreclosed Real Estate is considered substandard.



Delinquent Loans and Non-Performing Assets. The following
tables set forth the Companys delinquent loans and non-performing
assets as of the dates indicated. Balances are indicative of the
total principal balances of such loans rather than the actual
principal past due based on the number of payments past due. At
December 31 of the five years presented, predominantly all of
the Associations delinquent loans and non performing assets
were either 1-4 family residential dwellings or loans secured
by 1-4 family residential loans.











|                       |   | 2000  |   | 1999  |   | 1998  |   | 1997  |   | 1996 
|---------------------- | - | ----- | - | ----- | - | ----- | - | ----- | - | -----
|                       |   | ----- |   | ----- |   | ----- |   | ----- |   | -----
|30-89 Days             | $ | 2,231 | $ | 2,673 | $ | 2,171 | $ | 271   | $ | 175  
|90+ Days               |   | 434   |   | 100   |   | 266   |   | 166   |   | 253  
|                       |   | ----- |   | ----- |   | ----- |   | ----- |   | -----
|Total Delinquent Loans | $ | 2,665 | $ | 2,773 | $ | 2,437 | $ | 437   | $ | 428  
|                       |   | ====  |   | ====  |   | ====  |   | ====  |   | ==== 

During 1998, the Company changed its data processing parameters
to include accounts exactly 30 days past due in the delinquent
30-89 day category. This accounts for the material increase in
the amount of loans delinquent 30-89 days in 1998 through 2000
compared to 1997 and 1996.







|                            |                     |     | 2000  |     | 1999  |     | 1998  |     | 1997  |     | 1996 
|--------------------------- | ------------------- | --- | ----- | --- | ----- | --- | ----- | --- | ----- | --- | -----
|                            |                     |     | ----- |     | ----- |     | ----- |     | ----- |     | -----
|90+ Day Delinquent Loans    | $                   | 434 | $     | 100 | $     | 266 | $     | 166 | $     | 253
|Foreclosed Real Estate      |                     | 117 |       | 14  |       | -   |       | -   |       | -  
|                            |                     |     | ----- |     | ----- |     | ----- |     | ----- |     | -----
|Total Non Performing Assets | $                   | 551 | $     | 114 | $     | 266 | $     | 166 | $     | 253
|                            |                     |     | ===   |     | ===   |     | ===   |     | ===   |     | ===  
|Non Performing Loans as     |                     |     |       |     |       |     |       |     |       |    
|                            | a % of Total Loans  |     | .58%  |     | .14%  |     | .42%  |     | .31%  |     | .57% 
|Non Performing Assets as    |                     |     |       |     |       |     |       |     |       |    
|                            | a % of Total Assets |     | .28%  |     | .06%  |     | .17%  |     | .13%  |     | .29% 



Classified Assets.The following table presents information
pertaining to the Companys Watch list of classified assets
and associated specific valuation allowances as of the dates indicated.
All substandard and special mention loans receivable and related
specific valuation allowances were on 1-4 family residential mortgage
loans.











|                   |             |       | At December 31,
|------------------ | ----------- | ----- | ---------------
|                   |             |       | 2000           
|                   |             |       | ------         
|Substandard        | $           | 1,785 | $              
|Special Mention    |             | 127   |                
|                   |             |       | ------         
|Gross              |             | 1,912 |                
|                   |             |       |                
|Less Allowance for |             |       |                
|                   | Loan Loss * |       | -              
|                   |             |       | ------         
|Net                | $           | 1,912 | $              
|                   |             |       | =====          

* Up until the safety and soundness examination completed by
the OTS in November, 1999, the Company maintained a specific and
general valuation allowance for loan loss. At the suggestion of
OTS regulators, the Company adopted a methodology of one single
allowance for loan loss, eliminating the prior separate accounting
of the specific and general valuation allowances for loan loss.

Allowance for Loan Loss. The allowance for loan loss
("ALL") is calculated by assessing the need for specific
reserves on identified problem credits (see special assets in
the previous paragraph) in addition to using historical and economic
based percentages on certain classifications of homogeneous loans
to arrive at an overall ALL. Several of these categories are based
on the particular loan being included on the Companys Watch
List. Other categories are based on the type of underlying collateral
such as commercial or residential real estate while still other
categories are based on the nature of the loan such as construction
verses permanent financing. At December 31, 2000, the ALL was
allocated as follows:



GS Financial Corp.

Allocation of the Allowance for Loan Losses

As of December 31, 2000



|Balance at
    End of PeriodApplicable to: | 2000                      | 1999   | 1998                      | 1997   | 1996                     
|------------------------------------------ | ------------------------- | ------ | ------------------------- | ------ | -------------------------
|Amount                                     | Percent
    of TotalLoans | Amount | Percent
    of TotalLoans | Amount | Percent
    of TotalLoans
|One to Four Family Residential             | 390                       | 94.9%  | 340                       | 95.7%  | 377                      
|FHA and VA                                 | -                         | .1%    | -                         | .2%    | -                        
|Construction                               | -                         | .8%    | -                         | .9%    | -                        
|Commercial Real Estate                     | 24                        | 1.3%   | 39                        | 2.0%   | 15                       
|Other Real Estate                          | -                         | 1.9%   | 45                        | .6%    | 45                       
|Second Mortgage                            | -                         | .1%    | -                         | .1%    | 26                       
|Loans on Deposits                          | -                         | .3%    | -                         | .5%    | -                        
|Commercial Loans                           | 6                         | .5%    | -                         | n/a    | -                        
|                                           |                           |        |                           |        |                          
|TOTAL                                      | 420                       | 100.0% | 424                       | 100.0% | 463                      



LOAN LOSS EXPERIENCE

Provisions for loan losses are charged to earnings to bring
the total ALL to a level considered appropriate by management.
Losses are incurred via foreclosure, deterioration the of the
underlying collateral, inability of the customer to repay the
loan or other means. These losses are charged against the ALL.
As mentioned earlier, the ALL is evaluated on a quarterly basis
and provisions to increase or reductions to reduce the allowance
to the appropriate level deemed by management are recorded when
necessary. Charge-offs reduce the allowance while recoveries increase
the allowance during the quarter. Management assesses the ALL
accordingly and establishes additional provisions to bring the
ALL to an appropriate level. The appropriate level of the ALL
is determined by managements estimation of the amount of
loss associated with loans considered to be impaired in accordance
with SFAS 114, "Accounting by Creditors for Impairment of
a Loan," as well as managements estimate of loss associated
with the remaining portfolio. Historical analysis of factors such
as number of foreclosures, level of delinquencies and amount of
charge-offs as well as other factors such as local and national
economic conditions help management set both the formula used
to calculate the ALL for the remaining loan portfolio as well
as an appropriate level for the ALL overall.

The following table sets forth the Companys loan loss
experience for the years presented. All of the charge-offs and
provisions in the following table were on first mortgages of one-to-four
family dwellings.



An analysis of the allowance for loan losses is as follow (dollars
in thousands):



|                     |                        |        | Years Ended December 31,
|-------------------- | ---------------------- | ------ | ------------------------
|                     |                        |        | 2000                    
|                     |                        |        | -----                   
|Balance, Beginning   |                        |        |                         
|                     | of Year                | $      | 424                     
|Provision for Losses |                        | 7      |                         
|Loans Charged Off    |                        | (11)   |                         
|Recoveries           |                        | -      |                         
|                     |                        |        | -----                   
|Balance, End of Year | $                      | 420    | $                       
|                     |                        |        | ====                    
|Allowance for Loan   |                        |        |                         
|                     | Losses as a % of       |        |                         
|                     | Total Loans Receivable | .56%   | .60%                    
|Allowance for Loan   |                        |        |                         
|                     | Losses as a % of       |        |                         
|                     | Non Performing Loans   | 96.69% | 422.97%                 

Mortgage-Backed Securities

The Company has invested in a portfolio of mostly fixed-rate,
mortgage-backed securities that are issued or guaranteed by the
Federal Home Loan Mortgage Corporation (FHLMC), the Federal National
Mortgage Association (FNMA) or the Government National Mortgage
Association (GNMA). The FHLMC and FNMA are enterprises sponsored
by the Federal government while GNMA securities represent direct
obligations of the Federal government. Because of this, these
securities are considered high quality investments with minimal
credit risks. The guaranteed aspect of these investments results
in yields slightly less than the actual yields on the underlying
mortgage loans.

Mortgage-backed securities represent participating interests
in pools of first mortgage loans originated and serviced by their
prospective issuers. Principal and interest payments of the underlying
mortgage loans are passed through intermediaries, including but
not limited to the issuing agencies, on to investors such as GS
Financial Corp. These securities in general offer slightly higher
yields than United States Treasury obligations.

The Company invests in mortgage-backed securities with terms
varying from 5 to 30 years. These securities are subject to variations
in cash flow and yield due to the prepayment rates of the underlying
mortgage loans. All such mortgage-backed securities meet the requirements
of qualified thrifts investments as later defined.

On September 30, 1997 the Company reclassified all of its mortgage-backed
securities as available-for-sale pursuant to SFAS 115. Management
felt that this classification was more appropriate considering
the magnitude of the Companys investment in these instruments
and the liquidity available should other investment opportunities
arrive.

The following table sets forth the composition of the Companys
mortgage-backed securities portfolio at each of the dates indicated
(in thousands):

MORTGAGE-BACKED SECURITIES



|December 31, 2000   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|------------------- | - | -------------- | ---------------------- | ----------------------- | ---------------
|                    |   | ----------     |                        | ----------              |                
|Available for Sale: |   |                |                        |                         |                
|FNMA                | $ | 1,481          | $                      | -                       | $              
|FHLMC               |   | 1,096          |                        | -                       |                
|GNMA                |   | 1,541          |                        | 4                       |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 4,118          | $                      | 4                       | $              
|                    |   | =====          |                        | =====                   |                
|                    |   |                |                        |                         |                
|December 31, 1999   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|                    |   | ----------     |                        | ----------              |                
|Available for Sale: |   |                |                        |                         |                
|FNMA                | $ | 5,255          | $                      | 1                       | $              
|FHLMC               |   | 1,328          |                        | 3                       |                
|GNMA                |   | 10,160         |                        | -                       |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 16,743         | $                      | 4                       | $              
|                    |   | =====          |                        | =====                   |                

The following table sets forth the maturities of the mortgage-backed
security portfolio as of December 31, 2000 (in thousands):



MORTGAGE-BACKED SECURITIES



|                                     | December 31, 2000                  |   | Amortized Cost | Fair Value | Weighted Average Rate
|------------------------------------ | ---------------------------------- | - | -------------- | ---------- | ---------------------
|                                     |                                    |   | ---------      |            | ---------            
|Mortgage-Backed Securities Maturing: |                                    |   |                |            |                      
|                                     | In One Year or Less                | $ | 230            | $          | 230                  
|                                     | After One Year Through Five Years  |   | 814            |            | 819                  
|                                     | After Five Years Through Ten Years |   | 1,187          |            | 1,177                
|                                     | After Ten Years                    |   | 1,887          |            | 1,889                
|                                     |                                    |   | ------         |            | ------               
|                                     |                                    | $ | 4,118          | $          | 4,115                
|                                     |                                    |   | =====          |            | =====                

The following table sets forth the purchases, sales and principal
repayments of the Companys mortgage-backed securities during
the periods indicated (in thousands):

MORTGAGE-BACKED SECURITIES



|                           |                           |                  |          | 2000    |         | 1999    |          | 1998   
|-------------------------- | ------------------------- | ---------------- | -------- | ------- | ------- | ------- | -------- | -------
|                           |                           |                  |          | ------- |         | ------- |          | -------
|Mortgage Backed Securities |                           |                  |          |         |         |        
|                           | Balance at January 1,     | $                | 16,743   | $       | 23,058  | $       | 41,648  
|                           | Purchases                 |                  | -        |         | -       |         | 5,764   
|                           | Repayments                |                  | (1,956)  |         | (6,227) |         | (11,790)
|                           | Sales (Net of Gains)      |                  | (10,650) |         | -       |         | (12,388)
|                           | Amortizations of Premiums |                  |          |         |         |         |         
|                           |                           | /Discounts (Net) |          | (19)    |         | (88)    |          | (176)  
|                           |                           |                  |          | ------- |         | ------- |          | -------
|                           | Balance at December 31,   | $                | 4,118    | $       | 16,743  | $       | 23,058  
|                           |                           |                  |          | ======  |         | ======  |          | ====== 
|                           | Weighted Average Yield    |                  | 6.68%    |         | 6.53%   |         | 6.34%   

Investment Securities

The Company invests in United States Treasury and Agency issued
obligations ranging in term from 3 months to 10 years. The investment
policy of the Company is reviewed periodically by Management and
ratified annually by the Board of Directors. At present the investment
policy of the Company strives to maintain a liquid, conservative
portfolio of investments keeping in mind the cash flow and investment
needs of the Company.

The Company also invests its excess cash in two institutional
funds whose principal underlying holdings are qualified thrift
investments. One is an adjustable rate mortgage (ARM) fund while
the other is an intermediate mortgage fund (IMF). Both of these
funds are offered by the First Financial Trust, which is a co-
operative institutional investment group comprised of members
of Americas Community Bankers. These two funds provide a
supplement to the Companys other short-term money market
investments and Federal Funds Sold, typically yielding a higher
rate of return while still providing excellent liquidity.

Interest rates dictate many of the investment decisions and
policies of the Company. It is the policy of the Company not to
engage in speculative purchasing, selling or trading of investments,
however, certain profits may be taken from time to time on the
sale of investments. When interest rate spreads reach acceptable
levels the Company may utilize leveraged purchasing of investment
securities. Also, when anticipated earnings permit, certain portfolio
adjustments may be made to enhance the overall portfolio yield
even though losses may be recognized in doing so.

The Companys investment portfolio is classified as available-for-sale
in accordance with SFAS 115. Prior to 1997, the Companys
investment portfolio was largely classified as held-to-maturity
with only approximately 5% to 10% being classified available for
sale. That amount was determined by Management as necessary should
any emergency liquidity demands arise. On September 30, 1996,
the Company sold investments classified held-to-maturity, thus
"tainting" the portfolio and forcing 100% of the portfolio
to be classified as available-for-sale. Management felt this was
in the best interest of the Company in considering the then current
interest rate environment, high loan demand, capital strength
of the Company and future investment avenues which might be pursued
in light of the impending stock conversion.

INVESTMENT SECURITIES

Securities available-for-sale consist of the following (in
thousands):



|                           | December 31, 2000    |       | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|-------------------------- | -------------------- | ----- | -------------- | ---------------------- | ----------------------- | ---------------
|                           |                      |       | ----------     |                        | ----------              |                
|U. S. Government           |                      |       |                |                        |                         |                
|                           | and Federal Agencies | $     | 2,389          | $                      | 72                      | $              
|Adjustable Rate            |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 2,831          |                        | -                       |                
|Intermediate               |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 400            |                        | -                       |                
|                           |                      |       |                |                        |                         |                
|FHLMC Common Stock         |                      | 25    |                | 1,767                  |                         | -              
|FHLMC Preferred Stock      |                      | 3,506 |                |                        |                         | 2              
|Equity Investments - Other |                      | 50    |                | -                      |                         | -              
|                           |                      |       | -------        |                        | -------                 |                
|                           |                      | $     | 9,201          | $                      | 1,839                   | $              
|                           |                      |       | =====          |                        | =====                   |                
|                           |                      |       |                |                        |                         |                
|                           | December 31, 1999    |       | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|                           |                      |       | ----------     |                        | ----------              |                
|U. S. Government           |                      |       |                |                        |                         |                
|                           | and Federal Agencies | $     | 4,678          | $                      | 35                      | $              
|Adjustable Rate            |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 1,390          |                        | -                       |                
|Intermediate               |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 2,972          |                        | -                       |                
|                           |                      |       |                |                        |                         |                
|FHLMC Common Stock         |                      | 35    |                | 1,659                  |                         | -              
|                           |                      |       | -------        |                        | -------                 |                
|                           |                      | $     | 9,075          | $                      | 1,694                   | $              
|                           |                      |       | =====          |                        | =====                   |                



The following table sets forth the amount of investment securities
which mature during each of the periods indicated at December
31, 2000:

INVESTMENT SECURITIES



|                     |                                    | Securities        
|-------------------- | ---------------------------------- | ------------------
|                     |                                    | Available-for-Sale
|                     | December 31, 2000                  |                   
|                     |                                    |                   
|Amounts Maturing in: |                                    |                   
|                     | In One Year or Less                | $                 
|                     | After One Year Through Five Years  |                   
|                     | After Five Years Through Ten Years |                   
|                     |                                    |                   
|                     |                                    | $                 
|                     |                                    |                   

COLLATERALIZED MORTGAGE OBLIGATIONS

Currently, the Companys investment in Collateralized
Mortgage Obligations (CMOs) is limited to first-tranche
Real Estate Mortgage Investment Conduits (REMICs). A REMIC
is a pass through investment created under the Tax Reform Act
of 1986 to issue multiple class mortgage-backed securities. The
mulitiple classes within a REMIC are known as "tranches."
The tranches are paid principal and/or interest based on the payment
schedule outlined in the prospectus.

The Companys investment in REMICs is limited to
those issued by FNMA, FHLMC and "AAA" rated non-governmental
issuers. These are defined to be within the 20% risk-weighted
category for thrift institutions. The contractual maturity of
a REMIC is defined by the latest maturity date of the underlying
group of mortgage loans. In terms of actual cash flow, the term
or duration of the REMICs purchased by the Company varies
from 2 to 4 years. The cash flow of these investments facilitates
the operating needs of the Company.



The following table sets forth the composition of the Companys
portfolio of Collateralized Mortgage Obligations indicated (in
thousands):

COLLATERALIZED MORTGAGE OBLIGATIONS



|December 31, 2000   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|------------------- | - | -------------- | ---------------------- | ----------------------- | ---------------
|                    |   | ----------     |                        | ----------              |                
|Available-for-Sale: |   |                |                        |                         |                
|FNMA                | $ | 5,766          | $                      | -                       | $              
|FHLMC               |   | 14,254         |                        | 196                     |                
|Other               |   | 33,562         |                        | 583                     |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 53,582         | $                      | 779                     | $              
|                    |   | =====          |                        | =====                   |                

|December 31, 1999   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|------------------- | - | -------------- | ---------------------- | ----------------------- | ---------------
|                    |   | ----------     |                        | ----------              |                
|Available-for-Sale: |   |                |                        |                         |                
|FNMA                | $ | 8,058          | $                      | -                       | $              
|FHLMC               |   | 17,347         |                        | 167                     |                
|Other               |   | 28,493         |                        | 15                      |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 53,898         | $                      | 182                     | $              
|                    |   | =====          |                        | =====                   |                

Sources of Funds

General. Deposits have always been the primary source
of the Companys funds for lending and other investment purposes.
The supply of retail deposits has decreased due to more investors
putting their money in the markets. As a result the Company has
turned towards wholesale sources such as the FHLB which allows
member institutions such as the Company to borrow money at discounted
costs.

Deposits. The Companys deposits are attracted
principally from within its market area. Many depositors are also
mortgage loan customers. The Company offers passbook savings,
demand deposit accounts, now accounts and certificates of deposit.
Terms for certificates vary from 3 months to 5 years while rates
tend to increase with term.



The following table shows the distribution of, and certain
other information relating to the Companys deposits. Deposit
account balances at December 31, 2000, 1999, and 1998 are summarized
as follows (in thousands):



|                 |          | Years Ending December 31,
|---------------- | -------- | -------------------------
|                 |          |                          
|                 |          |                          
|                 |          |                          
|                 |          |                          
|                 |          |                          
|Demand Deposit   |          |                          
|                 | Accounts | $                        
|Passbook Savings |          |                          
|                 | Accounts |                          
|Certificates of  |          |                          
|                 | Deposit  |                          
|                 |          |                          
|                 |          | $                        
|                 |          |                          

The following table sets forth the deposit cash flow of the
Company during the periods indicated (in thousands):



|                                    |                   | Year Ended December 31,
|----------------------------------- | ----------------- | -----------------------
|                                    |                   |                        
|                                    |                   |                        
|Increase (decrease) before          |                   |                        
|                                    | Interest Credited | $                      
|Interest Credited                   |                   | 2,059                  
|                                    |                   |                        
|Net increase (decrease) in deposits | $                 | (337)                  

The Company attempts to price its deposit accounts to remain
generally competitive with other financial institutions in its
market area, while maintaining its traditional margins. Traditionally
the Company has relied on its passbook savings accounts as a core
deposit base. In line with such policies, the Company does not
pay "jumbo" rates for deposits $100,000 and over.

The principal methods used by the Company to attract deposits
include its emphasis on personal service, competitive interest
rates and convenient office locations. The Company does not advertise
for deposits outside of its primary market area. At December 31,
2000, the Company had no deposits that were obtained through deposit
brokers.

The following table presents the amount of certificates of
deposit at December 31, 2000 which mature during the periods indicated
(in thousands).



|                              |                        |        | Amount  | Percent
|----------------------------- | ---------------------- | ------ | ------- | -------
|                              |                        |        | ------- | -------
|Certificate Accounts Maturing |                        |        |        
|                              | Under 12 months        | $      | 29,478  | 77.04% 
|                              | 12 months to 24 months |        | 6,387   | 16.69% 
|                              | 24 months to 36 months |        | 1,710   | 4.47%  
|                              | 36 months to 48 months |        | 251     | .66%   
|                              | 48 months to 60 months |        | 437     | 1.14%  
|                              |                        |        | ------  | -----  
|Total Certificates            | $                      | 38,263 | 100.00%
|                              |                        |        | =====   | ====== 

The following table sets forth the maturities of the Companys
deposits of $100,000 or more at December 31, 2000 by time remaining
to maturity (in thousands).

DEPOSITS 100,000 AND OVER

(in thousands)



|Maturing in 3 months or less     | $ | 1,986 
|-------------------------------- | - | ------
|Maturing in 3 to 6 months        |   | 614   
|Maturing in 6 months to 1 year   |   | 1,118 
|Maturing in 1 to 2 years         |   | 210   
|                                 |   | ------
|Total Deposits $100,000 and over | $ | 3,928 
|                                 |   | ===== 



Borrowings. During 2000 the Company obtained advances
from the FHLB, usually as part of a leveraged investment program.
The Company borrows the funds which are subsequently reinvested
in mortgage-backed securities, collateralized mortgage obligations
and other investments which earn interest at a rate greater than
the rate charged on the advances. The advances consist of fully
amortizing and balloon advances which mature between January,
2001 and June, 2008. A summary of the advances by maturity and
interest rate are detailed as follows (in thousands):



|                     |   |            | Weighted  
|-------------------- | - | ---------- | ----------
|Maturing in the Year |   |            | Average   
|Ending December 31,  |   | Amount     | Rate      
|-------------------  |   | ---------- | ----------
|2001                 | $ | 19,318     | 6.55%     
|2002                 |   | 7,828      | 6.21%     
|2003                 |   | 8,329      | 5.53%     
|2004                 |   | -          | -         
|2005                 |   | 6,709      | 6.57%     
|Thereafter           |   | 12,007     | 5.50%     
|                     |   | ---------  |           
|                     | $ | 54,191     |           

The maximum amount of advances outstanding at any month-end
during 2000 was $60.3 million. The average balance outstanding
during 2000 was $53.9 million. Prior to 1997 the Company had no
material borrowings.

Treasury Stock

Since 1998, the Company has been repurchasing shares of its
common stock. The Company became eligible one year from the date
of its initial public offering to begin repurchasing stock. For
the first two years of the buyback program, the Company was limited
to 10% per year per OTS regulations. On April 1, 2000, the three
year anniversary of the Companys IPO, the 10% per year limitation
on buybacks was lifted. The following table summarizes the repurchase
of shares of its common stock by year:

GS Financial Corp.

Common Stock Repurchases



|Year  | SharesRepurchased | AveragePrice
|----- | ----------------- | ------------
|1998  | 491,054           | $ 16.95     
|1999  | 299,000           | $ 12.22     
|2000  | 679,600           | $ 12.64     
|      | ------------      | --------    
|Total | 1,469,654         | $ 13.99     

All purchases were open market transactions. Due to the highly
capitalized condition of the Company, management felt that these
purchases, most of which were at a discount to book value, were
an effective way to reduce capital while still enhancing shareholder
value. The alternative to reducing capital would have been rapid
growth probably through some type of acquisition. Given the premium
nature of current financial institution buyouts, the alternative
approach to reducing capital through buybacks seemed a more conservative
approach. These shares have not been retired and could potentially
serve as a source of funding should the need arise in the future.

Subsidiaries

Guaranty Savings & Homestead Association is a wholly-owned
subsidiary of the Company. The Company has no other subsidiaries.

Competition

Guaranty Savings & Homestead Association faces significant
competition both in attracting deposits and in originating loans.
Its most direct competition for deposits has come from commercial
banks, credit unions, other savings and loans and mortgage brokers
located in the metropolitan New Orleans market. The Association
also competes for investors funds with short-term money
market mutual funds and issuers of corporate and government securities.
Guaranty Savings & Homestead Association does not rely on
any individual group or entity for a material portion of its deposits
or mortgage loan portfolio. The Associations primary factors
in competing in the home mortgage loan market are its efficient
personal service and attractive interest rates and terms.

Employees

The Association had 31 full-time employees at December 31,
2000. None of these employees are represented by a collective
bargaining agreement. Guaranty Savings & Homestead Association
believes that it enjoys excellent relations with its personnel.

Regulation

Set forth below is a brief description of certain laws and
regulations which are applicable to the Company and Guaranty Savings
& Homestead Association. The description of these laws and
regulations, as well as descriptions of laws and regulations contained
elsewhere herein, does not purport to be complete and is qualified
in its entirety by reference to applicable laws and regulations.

The Company

General. The Company, as a savings and loan holding
company within the meaning of the Home Owners Loan Act,
as amended ("HOLA"), is registered with and subject
to OTS regulations, examinations, supervision and reporting. As
a subsidiary of a savings and loan holding company, Guaranty Savings
& Homestead Association is subject to certain restrictions
in its dealings with the Company and any affiliates thereof.

Activities Restrictions. There are generally no restrictions
on the activities of a savings and loan holding company which
holds only one subsidiary savings institution. However, if the
Director of the OTS determines that there is reasonable cause
to believe that the continuation by a savings and loan holding
company of an activity constitutes a serious risk to the financial
safety, soundness or stability of its subsidiary savings institution,
the Director may impose such restrictions as deemed necessary
to address such risk, including limiting (i) payment of dividends
by the savings institution; (ii) transactions between the savings
institution and its affiliates; and (iii) any activities of the
savings institution that might create a serious risk that the
liabilities of the holding company and its affiliates may be imposed
on the savings institution. Notwithstanding the above rules as
to permissible business activities of unitary savings and loan
holding companies, if the savings institution subsidiary of such
a holding company fails to meet the qualified thrift lender ("QTL")
test, as discussed under "- The Association  Qualified
Thrift Lender Test," then such unitary holding company also
shall become subject to the activities restrictions applicable
to multiple savings and loan holding companies and, unless the
savings institution re-qualifies as a QTL within one year thereafter,
shall register as, and become subject to the restrictions applicable
to, a bank holding company. See "- The Association 
Qualified Thrift Lender Test."

If the Company were to acquire control of another savings institution,
other than through merger or other business combination with Guaranty
Savings, the Company would thereupon become a multiple savings
and loan holding company. Except where such acquisition is pursuant
to the authority to approve emergency thrift acquisitions and
where each subsidiary savings institution meets the QTL test,
as set forth below, the activities of the Company and any of its
subsidiaries (other than Guaranty Savings or other subsidiary
savings institutions) would thereafter be subject to further restrictions.
Among other things, no multiple savings and loan holding company
or subsidiary thereof which is not a savings institution shall
commence or continue for a limited period of time after becoming
a multiple savings and loan holding company or subsidiary thereof
any business activity, other than: (i) furnishing or performing
management services for a subsidiary savings institution; (ii)
conducting an insurance agency or escrow business; (iii) holding,
managing, or liquidating assets owned by or acquired from a subsidiary
savings institution; (iv) holding or managing properties used
or occupied by a subsidiary savings institution; (v) acting as
trustee under deeds of trust; (vi) those activities authorized
by regulation as of March 5, 1987 to be engaged in by multiple
savings and loan holding companies; or (vii) unless the Director
of the OTS by regulation prohibits or limits such activities for
savings and loan holding companies. Those activities described
in clause (vii) above also must be approved by the Director of
the OTS prior to being engaged in by a multiple savings and loan
holding company.

Limitations on Transactions with Affiliates. Transactions
between savings institutions and any affiliate are governed by
Sections 23A and 23B of the Federal Reserve Act. An affiliate
of a savings institution is any company or entity which controls,
is controlled by or is under common control with the savings institution.
In a holding company context, the parent holding company of a
savings institution (such as the Company) and any companies which
are controlled by such parent holding company are affiliates of
the savings institution. Generally, Sections 23A and 23B (i) limit
the extent to which the savings institution or its subsidiaries
may engage in "covered transactions" with any one affiliate
to an amount equal to 10% of such institutions capital stock
and surplus, and contain an aggregate limit on all such transactions
with all affiliates to an amount equal to 20% of such capital
stock and surplus and (ii) require that all such transactions
be on terms substantially the same, or at least as favorable,
to the institution or subsidiary as those provided to a non-affiliate.
The term "covered transaction" includes the making of
loans, purchase of assets, issuance of guarantee and other similar
transactions. In addition to the restrictions imposed by Sections
23A and 23B, no savings institution may (i) loan or otherwise
extend credit to an affiliate, except for any affiliate which
engages only in activities which are permissible for bank holding
companies, or (ii) purchase or invest in any stocks, bonds, debentures,
notes or similar obligations of any affiliate, except for affiliates
which are subsidiaries of the savings institution.

In addition, Sections 22(h) and (g) of the Federal Reserve
Act place restrictions on loans to executive officers, directors
and principal stockholders. Under Section 22(h), secured loans
to a director, an executive officer and to a greater than 10%
stockholder of a savings institution, and certain affiliated interest
of either, may not exceed, together with all other outstanding
loans to such person and affiliated interests, the savings institutions
loans to one borrower limit (generally equal to 25% of the institutions
unimpaired capital and surplus). Section 22(h) also requires that
loans to directors, executive officers and principal stockholders
be made on terms substantially the same as offered in comparable
transactions to other persons unless the loans are made pursuant
to a benefit or compensation program that (i) is widely available
to employees of the institution and (ii) does not give preference
to any director, executive officer or principal stockholder, or
certain affiliated interests of either, over other employees of
the savings institution. Section 22(h) also requires prior Board
approval for certain loans. In addition, the aggregate amount
of extensions of credit by a savings institution to all insiders
cannot exceed the institutions unimpaired capital and surplus.
Furthermore, Section 22(g) places additional restrictions on loans
to executive officers. At December 31, 2000 Guaranty Savings was
in compliance with the above restrictions.

Restrictions on Acquisitions. Except under limited circumstances,
savings and loan holding companies are prohibited from acquiring,
without prior approval of the Director of the OTS, (i) control
of any other savings institution or savings and loan holding company
or substantially all the assets thereof or (ii) more than 5% of
the voting shares of a savings institution or holding company
thereof which is not a subsidiary. Except with the prior approval
of the Director of the OTS, no director or officer of a savings
and loan holding company or person owning or controlling by proxy
or otherwise more than 25% of such companys stock, may acquire
control of any savings institution, other than a subsidiary savings
institution, or of any other savings and loan holding company.

The Director of the OTS may only approve acquisitions resulting
in the formation of a multiple savings and loan holding company
which controls savings institutions in more than one state if
(i) the multiple savings and loan holding company involved controls
a savings institution which operated a home or branch office located
in the state of the institution to be acquired as of March 5,
1987; (ii) the acquirer is authorized to acquire control of the
savings institution pursuant to the emergency acquisition provisions
of the Federal Deposit Insurance Act ("FDIA"); or (iii)
the statutes of the state in which the institution to be acquired
is located specifically permit institutions to be acquired by
the state-chartered institutions or savings and loan holding companies
located in the state where the acquiring entity is located (or
by a holding company that controls such state-chartered savings
institutions).

Under the Bank Holding Company Act of 1956, the Federal Reserve
Bank ("FRB") is authorized to approve an application
by a bank holding company to acquire control of a savings institution.
In addition, a bank holding company that controls a savings institution
may merge or consolidate the assets and liabilities of the savings
institution with, or transfer assets and liabilities to, any subsidiary
bank which is a member of the Bank Insurance fund with the approval
of the appropriate federal banking agency and the FRB. As a result
of these provisions, there have been a number of acquisitions
of savings institutions by bank holding companies in recent years.

Federal Securities Laws. The Companys common stock
is registered with the SEC under the Securities and Exchange Act
of 1934 ("Exchange Act"). The Company is subject to
the information, proxy solicitation, insider trading restrictions
and other requirements under the Exchange Act.

Financial Modernization. Under the Gramm-Leach-Bliley
Act enacted into law on November 12, 1999, no company may acquire
control of a savings and loan holding company after May 4, 1999,
unless the company is engaged only in activities traditionally
permitted to a multiple savings and loan holding company or newly
permitted to a financial holding company under Section 4 (k) of
the Bank Holding Company Act. Existing savings and loan holding
companies and those formed pursuant to an application filed with
the OTS before May 4, 1999, may engage in any activity including
non-financial or commercial activities provided such companies
control only one savings and loan association that meets the Qualified
Thrift Lender test. Corporate reorganizations are permitted, but
the transfer of grand-fathered unitary thrift holding company
status through acquisition is not permitted.

The Association

General. As a Louisiana chartered stock savings and
loan association, the OFI is the Associations chartering
authority, and the OTS serves as the Associations primary
regulator. As such, the OFI and the OTS have extensive authority
over the operations of Louisiana-chartered savings institutions.
The Association is subject to periodic examinations and is required
to file monthly, quarterly and annual reports with either or both
parties. The investment and lending authority of savings institutions
are prohibited from engaging in any activities not permitted by
such laws and regulations. Such regulation and supervision is
primarily intended for the protection of depositors.

Insurance of Accounts. The deposits of Guaranty Savings
and Homestead Association are insured to the maximum permitted
by the SAIF, which is administered by the FDIC, and are backed
by the full faith and credit of the U.S. Government. As insurer,
the FDIC is authorized to conduct examinations of, and to require
reporting by, FDIC-insured institutions. It also may prohibit
any FDIC-insured institution from engaging in any activity the
FDIC determines by regulation or order to pose a serious threat
to the FDIC. The FDIC also has the authority to initiate enforcement
actions against savings institutions, after giving the OTS an
opportunity to take such action.

The FDIC may terminate the deposit insurance of any insured
depository institution, including Guaranty Savings and Homestead
Association, if it determines after a hearing that the institution
has engaged or is engaging in unsafe or unsound practices, is
in an unsafe or unsound condition to continue operations, or has
violated any applicable law, regulation, order or any condition
imposed by an agreement with the FDIC. It also may suspend deposit
insurance temporarily during the hearing process for the permanent
termination of insurance, if the institution has no tangible capital.
If insurance of accounts is terminated, the accounts at the institution
at the time of the termination, less subsequent withdrawals, shall
continue to be insured for a period of six months to two years,
as determined by the FDIC. Management is aware of no existing
circumstances which would result in termination of the Associations
deposit insurance.

Regulatory Capital Requirements. Federally insured savings
institutions are required to maintain minimum levels of regulatory
capital. Pursuant to the Financial Institutions Reform, Recovery
and Enforcement Act of 1989 ("FIRREA"), the OTS has
established capital standards applicable to all savings institutions.
These standards generally must be as stringent as the comparable
capital requirements imposed on national banks. The OTS also is
authorized to impose capital requirements in excess of these standards
on individual institutions on a case-by-case basis.

Current OTS capital standards require savings institutions
to satisfy three different capital requirements. Under these standards,
savings institutions must maintain tangible capital (1.5%), core
capital (3.0%), and risk based capital (8.0%). Core capital includes
generally recognized capital such as common stockholders
equity and retained earnings plus other items such as qualifying
goodwill. Tangible capital is essentially the same but does not
include qualifying supervisory goodwill. At December 31, 2000
the Association had no goodwill or other intangible assets which
are deducted in computing its tangible capital.

In determining risk-based capital, a savings institution is
allowed to include both core capital and supplementary capital.
Assets are assigned to particular risk-weighted categories and
subsequently multiplied by that particular percentage (cash and
US Treasury and Agency securities equal 0%, 20% for high quality
mortgage-backed securities including those issued by US Government
Agencies and "AAA" rated private companies, state and
local obligations, claims on FHLBs and claims on domestic
depository institutions, 50% for single family mortgage loans
and 100% for all other loans and investments). The sum of these
calculations becomes the total of risk-weighted assets which are
then used to calculate the Associations risk-based capital
ratio.

At December 31, 2000, Guaranty Savings exceeded all of its
regulatory capital requirements, with tangible, core and risk-
based capital ratios of 16.20%, 16.20% and 39.50% respectively.

Liquidity Requirements. All savings institutions are
required to maintain an average daily balance of liquid assets
equal to a certain percentage of the sum of its average daily
balance of net withdrawable deposit accounts and borrowings payable
in one year or less. As of December 31, 2000 Guaranty Savings
and Homestead Associations liquidity was 57.10%, or $58.3
million in excess of the minimum required 4%.

Capital Distributions. OTS regulations govern capital
distributions by savings institutions, which include cash dividends,
stock redemptions or repurchases, cash-out mergers, interest payments
on certain convertible debt and other transactions charged to
the capital account of a savings institution to make capital distributions.
Under these regulations, a safe harbor is created for specified
levels of capital distributions as long as the savings institution
meets their minimum capital requirements, and as long as such
institutions notify the OTS and receive no objection to the distribution
from the OTS. Savings institutions and distributions that do not
qualify for the safe harbor are required to obtain prior OTS approval
before making any capital distributions.

Under recently adopted amendments to the OTS regulations
which become effective April 1, 1999, a savings institution that
before and after the proposed distribution would at least be adequately
capitalized may make capital distributions during any calendar
year equal to net income for the applicable calendar year plus
net income for the prior two years less any capital distribution
in those prior periods. Failure to meet minimum capital requirements
will result in further restriction on capital distributions, including
possible prohibition without explicit OTS approval.

In order to make distributions under this safe harbor, institutions
which are subsidiaries of savings and loan holding companies must
submit 30 day written notice to the OTS prior to making the distribution.
The OTS may object to the distribution during the 30-day period
based on safety and soundness concerns.

Community Reinvestment. Under the Community Reinvestment
Act of 1977, as amended ("CRA"), as implemented by OTS
regulations, a savings institution has a continuing and affirmative
obligation consistent with its safe and sound operation to help
meet the credit needs of its entire community, including low and
moderate income neighborhoods. The CRA does not establish specific
lending requirements or programs for financial institutions nor
does it limit an institutions discretion to develop the
types of products and services that it believes are best suited
to its particular community, consistent with the CRA. The CRA
requires the OTS, in connection with its examination of a savings
institution, to assess the institutions record of meeting
the credit needs of its community and to take such record into
account in its evaluation of certain applications by such institution.
The CRA requires public disclosure of an institutions CRA
rating and requires the OTS to provide a written evaluation of
an institutions CRA performance utilizing a rating system
which identifies four levels of performance that may describe
an institutions record of meeting community needs: outstanding,
satisfactory, needs to improve and substantial noncompliance.
The CRA also requires all institutions to make public disclosure
of their CRA ratings. The Associations current CRA rating
is satisfactory.

Qualified Thrift Lender Test. The Qualified Thrift Lender
(QTL) Test measures the Associations level of qualified
thrift investments compared to its total portfolio assets (total
assets less intangibles, property used by a savings association
in its business and liquidity investments in an amount not to
exceed 20% of assets). Generally, qualified thrift investments
("QTIs")are residential housing related assets.
The Internal Revenue Service (IRS) requires a savings institution
to have at least 65% of its assets in "QTIs" to
qualify for tax treatment as a building and loan association.
At December 31, 2000, 94.20% of the Associations assets
were invested in QTIs which was in excess of the percentage
required to qualify the Association under the QTL test.

Federal Home Loan Bank System. Guaranty Savings and
Homestead Association is a member of the FHLB of Dallas. Each
FHLB serves as a reserve or central bank for its members within
its assigned region. It is funded primarily from proceeds derived
from the sale of FHLB agency issued obligations. As a member,
the Association is required to maintain stock in the FHLB of Dallas
in an amount equal to at least 1% of its aggregate unpaid residential
mortgage loans, home purchase contracts or similar obligations
at the beginning of each year or 5% of its advances from the FHLB
of Dallas, whichever is greater. At December 31, 2000, Guaranty
Savings and Homestead Association had $3.1 million in FHLB stock,
which was in compliance with this requirement.

Federal Taxation

General. The Company and the Association are subject
to the generally applicable corporate tax provisions of the Internal
Revenue Code (the "Code"), and the Association is subject
to certain additional provisions of the Code which apply to thrifts
and other types of financial institutions. The following discussion
of federal taxation is intended only to summarize certain pertinent
federal income tax matters relevant to the taxation of the Company
and the Association and is not a comprehensive discussion of the
tax rules applicable to the Company and the Association.

Year. The Company files a consolidated federal tax return
on the basis of a calendar year ending on December 31.

Bad Debt Reserves. A small financial institution (one
with an adjusted basis of assets of less than $500 million), such
as the Association, is required in tax years beginning after 1995
to determine additions to its bad debt reserves under the experience
method. Under the experience method, the deductible annual addition
to the institutions bad debt reserves is the amount necessary
to increase the balance of the reserve at the close of the taxable
year to the greater of (a) the amount which bears the same ratio
to loans outstanding at the close of the taxable year as the total
net bad debts sustained during the current and five preceding
taxable years bear to the sum of loans outstanding at the close
of the same six years, or (b) the lower of (i) the balance of
the reserve account at the close of the Associations "base
year," which was its tax year ended December 31, 1987, or
(ii) if the amount of loans outstanding at close of the taxable
year is less than the amount of loans outstanding at the close
of the base year, the amount which bears the same ratio to loans
outstanding at the close of the taxable year as the balance of
the reserve at the close of the base year bears to the amount
of loans outstanding at the close of the base year.

In 1996, the Association was required to change its method
of computing its bad debt deduction from other methods previously
allowable to the experience method. As a result of the change
in law, the Association is required to include an amount into
taxable income over a six-year period beginning in 1998. The amount
required to be included in taxable income is the difference between
its bad debt reserves at December 31, 1995, as determined under
previously allowable bad debt methods, and the reserve allowable
under the experience method at December 31, 1995. The amount to
be included in the Associations taxable income over the
six-year period beginning with 1998 is $145,346, or $24,224 per
year.

At December 31, 2000, the federal income tax reserves of the
Association included $5.5 million for which no federal income
tax has been provided. Because of these federal income tax reserves
and the liquidation account to be established for the benefit
of certain depositors of the Association in connection with the
conversion of the Association to stock form, the retained earnings
of the Association are substantially restricted.

Distributions. If the Association were to distribute
cash or property to its sole stockholder, and the distribution
was treated as being from its accumulated bad debt reserves, the
distribution would cause the Association to have additional taxable
income. A distribution is deemed to have been made from accumulated
bad debt reserves to the extent that (a) the reserves exceed the
amount that would have been accumulated on the basis of actual
loss experience, and (b) the distribution is a "non-qualified
distribution." A distribution with respect to stock is a
non- qualified distribution to the extent that, for federal income
tax purposes, (i) it is in redemption of shares, (ii) it is pursuant
to a liquidation of the institution, or (iii) in the case of a
current distribution, together will all other such distributions
during the taxable year, it exceeds the institutions current and
post-1951 accumulated earnings and profits. The amount of additional
taxable income created by a non-qualified distribution is an amount
that when reduced by the tax attributable to it is equal to the
amount of the distribution.

Minimum Tax. The Internal Revenue Code imposes an alternative
minimum tax at a rate of 20% on corporations with average annual
gross receipts in excess of $7.5 million for the prior three tax
years. Average annual gross receipts of the Company is in excess
of $7.5 million and as a result, the Company is subject to the
provisions of the alternative minimum tax provisions of the Code.
The alternative minimum tax generally applies to a base of regular
taxable income plus certain tax preferences ("alternative
minimum taxable income" or "AMTI") and is payable
to the extent such AMTI is in excess of an exemption amount. The
Code provides items of tax preference including (a) tax exempt
interest on newly issued (generally, issued after August 8, 1986)
private activity bonds other than certain qualified bonds, (b)
certain accelerated depreciation amounts and (c) 75% of the excess
if any of (i) adjusted current earnings as defined in the Code,
over (ii) AMTI (defined without regard to this preference and
prior to reduction by net operating losses).

Net Operating Loss Carryovers. A financial institution
may carry back net operating losses ("NOLs") to the
preceding two taxable years and forward to the succeeding 20 taxable
years. This provision applies to losses incurred in taxable years
beginning after 1986. At December 31, 2000, the Association had
no NOL carry-forwards for federal income tax purposes.

Capital Gains and Corporate Dividends-Received Deduction.
Corporate net capital gains are taxed at a maximum rate of 35%.
The corporate dividends-received deduction is 80% in the case
of dividends received from 20% or more owned corporations with
which a corporate recipient does not file a consolidated tax return.
Corporations which own less than 20% of the stock of a corporation
distributing a dividend may deduct only 70% of dividends received
or accrued on their behalf. However, a corporation may deduct
100% of dividends from a member of the same affiliated group of
corporations.

Other Matters. Federal legislation is introduced from
time to time that would limit the ability of individuals to deduct
interest paid on mortgage loans. Individuals are currently not
permitted to deduct interest on consumer loans. Significant increases
in tax rates or further restrictions on the deductibility of mortgage
interest could adversely affect the Association.

The Companys federal income tax returns for the tax years
ended December 31, 1997 forward are open under the statute of
limitations and are subject to review by the IRS. The Company
is currently being examined by the IRS for the tax year ended
December 31, 1998.

State Taxation

Any non-banking subsidiaries of the Association ( as well as
the Company) are subject to the Louisiana Corporation Income Tax
based on their Louisiana taxable income, as well as franchise
taxes. The Corporation Income Tax applies at graduated rates from
4% upon the first $25,000 of Louisiana taxable income to 8% on
all Louisiana taxable income in excess of $200,000. For these
purposes, "Louisiana taxable income" means net income
which is earned within or derived from sources within the State
of Louisiana, after adjustments permitted under Louisiana law
including a federal income tax deduction and an allowance for
net operating losses, if any. As a stock thrift, the Association
is subject to the Louisiana Shares Tax. The formula for deriving
the assessed value is to; (a) calculate 15% of the sum of 20%
of the companys capitalized earnings, plus (b) 80% of the
companys taxable stockholders equity, and to subtract
from that figure 50% of the companys real and personal property
assessment. Various items may also be subtracted in calculating
a companys capitalized earnings.

Franchise Tax

The Company is also subject to the Louisiana franchise tax,
which is imposed upon equity and certain borrowings (the franchise
base) at a rate of $3 for every $1,000 of franchise base. Financial
institution holding companies are allowed to reduce the franchise
base to the extent of investments in and advances to subsidiary
financial institutions.





Item 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

Item 7 of the Form 10-K is hereby amended and restated in its
entirety to read as follows:



The following discussion and analysis of the financial condition
and results of operations of GS Financial Corp. (the "Company")
and its subsidiary, Guaranty Savings and Homestead Association,
for the years ended December 31, 1996 through 2000 is designed
to assist readers in their understanding of the Company. This
review should be read in conjunction with the audited consolidated
financial statements, accompanying footnotes and supplemental
financial data included herein.

FORWARD-LOOKING STATEMENTS

In addition to historical information, this annual report includes
certain "forward-looking statements" based on current
management expectations. The Companys actual results could
differ materially, as defined in the Securities Act of 1933 and
the Securities Exchange Act of 1934, from those management expectations.
Such forward-looking statements include statements regarding our
intentions, beliefs or current expectations as well as the assumptions
on which such statements are based. Stockholders and potential
stockholders are cautioned that any such forward-looking statements
are not guarantees of future performance and involve risks and
uncertainties, and that actual results may differ materially from
those contemplated by such forward-looking statements. Factors
that could cause future results to vary from current management
expectations include, but are not limited to, general economic
conditions, legislative and regulatory changes, monetary and fiscal
policies of the federal government, changes in tax policies, rates
and regulations of federal, state and local tax authorities, changes
in interest rates, deposit flows, the cost of funds, demand for
loan products, demand for financial services, competition, changes
in the quality or composition of the Companys loan and investment
portfolios, changes in accounting principles, policies or guidelines,
and other economic, competitive, governmental and technological
factors affecting the Companys operations, markets, products,
services and fees.

The Company undertakes no obligation to update or revise any
forward-looking statements to reflect changed assumptions, the
occurrence of unanticipated events or changes to future operating
results over time.





ASSETS

General - Total assets of the Company decreased by $4.5
million from $158.0 million at December 31, 1999, to $153.5 million
at December 31, 2000. The decrease was primarily due to the net
effects of a $12.2 million decrease in mortgage-backed securities
partially offset by a $4.4 million increase in loans receivable
and a $1.6 million increase in collateralized mortgage obligations.
The purpose of the sale of the majority of the mortgage-backed
security portfolio was twofold, (1) create liquidity for loan
originations and additional stock buybacks and (2) reposition
some of the Companys investments in response to changing
interest rates.

Cash and Cash Equivalents - Cash and cash equivalents,
consisting of interest and non-interest bearing deposits and Federal
Funds Sold, increased $.9 million, or 36%, from $2.5 million at
December 31, 1999, to $3.4 million at December 31, 2000. Cash
and cash equivalents are utilized in the daily operations of the
Company. The Company maintains cash and cash equivalents sufficient
to meet the daily operational needs of the bank including, but
not limited to, operating expenses, loan funding, deposit withdrawals
and investment purchases. The Company also maintains positions
in mutual funds that are invested mostly in mortgage-based products.
These funds carry one-day availability and supplement the yield
of overnight Federal Funds Sold and interest-bearing deposits
in other financial institutions such as the Federal Home Loan
Bank.

Loans Receivable, Net - Loans receivable, net, increased
by $4.4 million, or 6%, from $70.1 million at December 31, 1999,
to $74.5 million at December 31, 2000. The primary change in the
loan portfolio was a $3.7 million increase in loans on 1-4 family
dwellings, from $67.4 million in 1999 to $71.1 million in 2000.
In the fall of 2000, the Company began offering commercial loans
and was able to originate $.4 million in such loans. Consumer
loans continued to decrease. Because of a slowdown in the local
real estate market and the increase in interest rates, there was
only a 6% growth in the loan portfolio in 2000 as compared to
the 10% growth in 1999.

Investment Securities - Investment securities increased
$.5 million, or 5%, from $10.5 million at December 31, 1999, to
$11.0 million at December 31, 2000. The Companys investment
securities consist of United States Treasury and Agency issues,
short-term mutual funds consisting primarily of qualified thrift
investments, Federal Home Loan Mortgage Corporation (FHLMC) common
and preferred stock and other equity investments. During 2000,
because of its low dividend yield, the Company sold 10,000 shares
of its FHLMC common stock at gain of $.4 million. The Company
also purchased $3.5 million of FHLMC Preferred Stock. The FHLMC
preferred stock purchased contained call options varying from
three to seven years and coupons varying from 5% to 6%. Seventy
percent of the dividends for the FHLMC preferred stock are tax
free, boosting the effective yield of this investment. During
2000, the Company charged-off $.2 million of its Intermediate
Mortgage Fund as it liquidated $2.4 million of this investment
to fund the liquidity needs of the Company.

Mortgage-Backed Securities - Mortgage-backed securities
decreased $12.2 million, or 75%, from $16.3 million at December
31, 1999, to $4.1 million at December 31, 2000. In 2000 the Company
sold $10.6 million in mortgage-backed securities which resulted
in a realized net loss of $.3 million. The Company completed these
transactions to generate cash for loan growth, for stock repurchases
and for new investment opportunities. At December 31, 2000 and
1999, all of the Companys mortgage-backed securities were
FHLMC, FNMA, or GNMA issued instruments. FHLMC and FNMA are enterprises
sponsored by the Federal government while GNMA securities represent
direct obligations of the Federal Government.

Collateralized Mortgage Obligations - The Company investment
in Collateralized Mortgage Obligations (CMOs) is limited to first-tranche
Real Estate Mortgage Investment Conduits (REMICs) which pay monthly.
REMICs are multiple class mortgage-backed securities whereby an
underlying pool of mortgages held by the issuer serves as collateral
for the debt. The Company has REMICs issued by FNMA, FHLMC and
"AAA" rated non-governmental agencies. The Company has
found these instruments to be ideal for its wholesale growth strategy
due to their regular repayment schedules and attractive yields.
The expected life of these REMICs varies from two to fifteen years.
Most of the investment in CMOs was funded by advances from the
Federal Home Loan Bank. During 2000, the Companys investment
in CMOs increased $1.6 million, or 3%, from $52.1 million at December
31, 1999, to $53.7 million at December 31, 2000.

LIABILITIES AND STOCKHOLDERS EQUITY

General - The Companys deposits, borrowings and
equity represent sources of funds for its various investments
and operating needs.

Deposits - The Companys deposits decreased $.3
million, or 1%, from $59.2 million at December 31, 1999, to $58.9
million at December 31, 2000. The change was due to the net result
of a $.7 million decrease in certificates of deposit, a $2.8 million
decrease in passbook savings accounts and a $3.2 million increase
in demand deposit accounts. Late in 1999, the Company began offering
checking accounts and installed automated teller machines (ATMs)
at all of its locations. During 2000, the Company began offering
NOW accounts.

Borrowings - The Companys borrowings increased
$.2 million, from $54.0 million at December 31, 1999 to $54.2
million at December 31, 2000. The Companys borrowings consist
of fully amortizing, balloon and "bullet"(interest only until maturity) advances from the Federal
Home Loan Bank of Dallas which mature between 2001 and 2008. These
borrowings represent the continuation of the Companys wholesale
growth strategy of leveraged investing.

Stockholders Equity - Stockholders equity
decreased $5.7 million, or 13%, from $43.5 million at December
31, 1999, to $37.8 million at December 31, 2000. The net decrease
was due to the net effects of stock buybacks of $8.6 million,
net income of $1.2 million, $.8 million in dividends paid, an
increase in accumulated other comprehensive income of $1.9 million
along with other minor adjustments.

Treasury Stock - During 2000, the Company repurchased
679,600 shares of its common stock for $8.6 million or an average
price of $12.65 per common share. Since the inception of its stock
buyback program in 1998, the Company has repurchased 1,469,654
shares of its common stock at an average price of $13.99 per common
share or $20.6 million, contributing to the enhancement of shareholder
value. At December 31, 2000, the book value was $19.20 per common
share. This compares to a book value of $16.44 per common share
at December 31, 1999.

COMPARISON OF RESULTS OF OPERATIONS

General - The Company reported net income of $1.2 million,
$1.4 million and $1.4 million for the years ended December 31,
2000, 1999, and 1998. The results for 2000 reflected generally
the same results from 1999 offset by the net loss on sale of securities
experienced in 2000. The earnings of the Company increased to
$.60 per common share. The results of operations and earnings
have been impacted through the continued stock repurchases of
the Company. During the last three years the Company has repurchased
$20.6 million of its common stock, with the largest portion ($8.6
million) being repurchased in 2000 when the Company reached the
three year anniversary of its initial public offering and became
free of many of the restrictions regarding stock repurchases.

Interest Income - Interest income increased $.6 million,
or 6%, from $10.7 million in 1999 to $11.3 million in 2000. Overall
results for 2000 reflected a yield of 7.42% on average earning
assets of $151.7 million compared to average earning assets of
$150.3 million in 1999 yielding 7.09%. Interest on CMOs
increased $.9 million, or 31%, in 2000 to $3.8 million as compared
to $2.9 million in 1999. For the fifth consecutive year, interest
on loans increased, from $5.3 million in 1999 to $5.8 million
in 2000. This increase of $.5 million represented growth of 9%.



The yield on loans receivable decreased from 7.99% in 1999
to 7.96% in 2000. This, however, was offset by an increase in
the average balance of net loans receivable of $5.9 million from
1999 to 2000. The drop in yield of the loan portfolio of only
three basis points marks the end of many years of double-digit
decreases. The "leveling out" of the yield of the loan
portfolio was due to rising interest rates and the liquidation
of many loans originated in the 1980s which had always skewed
the arithmetic average yield upward.

Interest income on investment securities decreased $.6 million,
or 60%, from $1.0 million in 1999 to $.4 million in 2000. The
yield on investment securities went down from 6.30% in 1999 to
5.71% in 2000. The reduction in yield was due to the Companys
increased investment in mortgage-based mutual funds and FHLMC
common stock compared to the Companys portfolio of U.S.
Treasury and Agency securities. The Companys portfolio of
U.S. Treasury and Agency securities yields approximately 7.25%
and consists primarily of securities purchased at least three
to four years ago when interest rates were significantly higher
than present rates. The Companys mortgage-based mutual funds
typically yield between 5.5% and 6.0% and act as a short-term
investment for the Company. The FHLMC common stock carries a dividend
yield to the Company of approximately 3%. The average balance
of investments decreased $8.0 million, or 52%, from 1999 to 2000.
The decrease in balance was due to the Companys redemption
of some of its holdings in short-term mutual funds, calls of agency
bonds and the sale of 10,000 shares of FHLMC common stock. As
mentioned earlier this sale resulted in a realized gain of $.4
million.





|                             |                                    | For the Years Ended December 31,
|---------------------------- | ---------------------------------- | --------------------------------
|                             |                                    | 2000                            
|                             |                                    | Average                         
|                             |                                    | Balance                         
|Interest Earning Assets      |                                    |                                 
|                             | Loans Receivable                   | 72,744                          
|                             | Mortgage Backed Securities         | 11,985                          
|                             | Investment Securities              | 7,432                           
|                             | Collateralized Mortgage            |                                 
|                             |                                    | Obligations                     
|                             | Other Interest Earning Assets      | 6,421                           
|                             | Total Interest Earning Assets      | 151,718                         
|                             | Non Interest Earning Assets        | 1,752                           
|                             | TOTAL ASSETS                       | 153,470                         
|                             |                                    |                                 
|Interest Bearing Liabilities |                                    |                                 
|                             | Passbooks Deposits                 | 18,957                          
|                             | Certificates of Deposits           | 39,151                          
|                             | Borrowings                         | 53,944                          
|                             | Total Interest Bearing Liabilities | 112,052                         
|                             | Non Interest Bearing Liabilities   | 1,238                           
|                             | TOTAL LIABILITIES                  | 113,290                         
|                             | Retained Earnings                  | 40,180                          
|                             | TOTAL LIABILITIES AND              |                                 
|                             |                                    | RETAINED EARNINGS               
|                             |                                    |                                 
|Net Interest Earning Assets  | 39,666                             |                                 
|Net Interest Income          |                                    | 5,387                           
|Net Interest Spread          |                                    |                                 
|Net Interest Margin          |                                    |                                 

Interest on Mortgage-backed securities decreased $.5 million
from $1.3 million in 1999 to $.8 million in 2000. This represents
a decrease of 27%. While the yield increased in 2000 to 6.68%,
compared to 6.53% in 1999, the average balance decreased $7.1
million from $19.1 million in 1999 to $12.0 million in 2000, accounting
for the decrease in income. The Company sold $10.6 million in
mortgage-backed securities at a loss of $.3 million. The cash
generated from the sale was used for stock repurchases, alternate
investments and the funding of mortgage loans. The Companys
divestment in mortgage-backed securities and investment in CMOs
can be explained by comparing the yield of these two investment
vehicles. In 2000, the Companys CMOs yielded 7.15% while
the mortgage-backed securities yielded 6.68%.

The $.9 million increase in interest on CMOs resulted
from the increase in yield from 6.44% in 1999 to 7.15% in 2000
and the increase in average balance from $44.5 million in 1999
to $53.1 million in 2000. Interest on CMOs was $3.8 million in
2000 compared to $2.9 million in 1999.

Interest income from other interest earning assets approximately
doubled from $.2 million in 1999 to $.4 million in 2000, which
resulted from the Company maintaining higher average balances
in Federal Funds Sold and other interest bearing deposits in other
financial institutions and the higher interest rates paid thereon.
The yield on other interest earning assets was 7.02% on an average
balance of $6.4 million in 2000, compared to 5.25% on an average
balance of $4.5 million in 1999. The yield in 2000 included a
special one-time dividend paid on the Federal Home Loan Bank stock.
The Company currently has $3.1 million in Federal Home Loan Bank
stock.



RATE/VOLUME ANALYSIS

The following table shows the extent to which changes in interest
rates and changes in volume of interest-related assets and liabilities
affected interest income and expense during the periods indicated.
For each category of interest-earning assets and interest-bearing
liabilities, information is provided on changes attributable to
(i) changes in volume (change in volume multiplied by prior year
rate) and (ii) changes in rate (change in rate multiplied by prior
year volume). The combined effect of changes in both rate and
volume has been allocated proportionately to the change due to
rate and the change due to volume.









|                      | 12/31/00 to 12/31/99 | 12/31/99 to 12/31/98
|--------------------- | -------------------- | --------------------
|                      | Rate                 | Volume              
|Interest Income       |                      |                     
|                      | Loans                | (20)                
|                      | MBS                  | 31                  
|                      | Invest               | (91)                
|                      | CMO's                | 319                 
|                      | Other                | 76                  
|                      |                      |                     
|Total                 | 315                  | 289                 
|                      |                      |                     
|Interest Expense      |                      |                     
|                      | Savings/NOW's        | 2                   
|                      | Certificates         | 186                 
|                      | Borrowings           | 154                 
|                      |                      |                     
|Total                 | 342                  | 312                 
|                      |                      |                     
|Increase(Decrease) in |                      |                     
|                      | Net Interest Income  | (27)                

Interest Expense - Interest expense increased $.7 million,
or 13%, from $5.2 million in 1999, compared to $5.9 million in
2000. Interest on FHLB advances increased $.5 million to $3.2
million in 2000 compared to $2.7 million in 1999. The increase
was due to the rise in market rates dictated by the Federal Reserves
three rate increases enacted during 2000. The cost of the Companys
FHLB advances were 5.95% in 2000 compared to 5.62% in 1999. The
average balance of borrowings was $53.9 million in 2000 compared
to $47.6 million in 1999. Interest expense on the Companys
retail deposits increased $.2 million to $2.7 million in 2000,
compared to $2.5 million in 1999. While the cost of passbook savings
was unchanged, the cost of the Companys certificates of
deposit increased to 5.35% in 2000 compared to 4.88% in 1999.
The Companys overall cost of funds for 2000 was 5.24% on
average interest-bearing liabilities of $112.1 million. This compares
to a cost of funds of 4.85% on an average balance of $107.7 million
in 1999.

Provision for Loan Losses. The ALL is evaluated on a
quarterly basis and provisions to increase or reductions to the
ALL to a level deemed appropriate by management are made accordingly.
Additional provisions are necessary when either growth in the
loan portfolio or charge-offs drop the ALL below that level deemed
appropriate by management. Reductions occur due to a decline in
the size of the loan portfolio or when previously reserved-for
loans are paid down or collected in full.

The low level of delinquent loans, the low number of foreclosures
and the growth of the local economy over the last two years has
enabled management to limit additional provisions to the ALL.
The Company had provision for loan losses of $7,000 in 2000 compared
to $6,000 in 1999. The $7,000 provision during the third quarter
of 2000 was necessary following charge-offs of $11,000. During
the fourth quarter of 1999, the $6,000 provision was necessitated
because of growth in the loan portfolio. The provision for loan
losses reflects managements evaluation of the underlying
credit risk of the Companys loan portfolio to adequately
provide for probable loan losses inherent in the loan portfolio
as of the balance sheet date. The allowance for loan losses ("ALL")
totaled 76.2% of non-performing assets at December 31, 2000, down
from 371.9% at December 31, 1999. The difference was due to the
virtual lack of non-performing assets at December 31, 1999. Non-performing
assets were $114,000 at December 31, 1999 compared to $551,000
at December 31, 2000. Future additions to the allowance for loan
losses will be dependent on a number of factors including the
performance of the Associations loan portfolio, the economy,
changes in interest rates and the effect of such changes on real
estate values, and inflation. Management believes that the allowance
for loan losses is adequate at December 31, 2000.

Non-Interest Income - Non-interest income for 2000 was
($.1) million, resulting from the net loss on the sale or redemption
of the Companys various investments (FHLMC common stock,
mortgage-backed securities and Intermediate Mortgage Fund). The
Companys other income consisting of various fees and service
charges was unchanged.

Other Expenses - Other expenses increased $.1 million
from $3.3 million for the twelve months ended December 31, 1999,
compared to $3.4 million for the twelve months ended December
31, 2000. The increase was attributable to an increase in compensation
expense of $.1 million. Ad Valorem taxes decreased $.1 million
due to the reduction of shareholder equity at the subsidiary level
with recent dividends from the Association to the Company. There
were minor increases or decreases in all other expenses.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity measures the Companys ability to meet its financial
commitments and obligations on a timely basis. These commitments
and obligations include loan disbursements, savings withdrawals
by customers, the payment of dividends, cash letters and the daily
operating expenses of the Company. Liquidity management involves
the daily monitoring of cash on hand, non-interest bearing operating
accounts, overnight Federal Funds Sold, short-term investments
and the Companys ability to convert these assets into cash
without incurring a loss. Monthly paydowns on mortgage loans,
mortgage-backed securities and collateralized mortgage obligations
are anticipated and channeled to either cash on hand, overnight
Federal Funds Sold or short-term investments in order to meet
the Companys demands and maximize interest earned on these
funds.

The Companys primary sources of funds are interest and
non-interest bearing customer deposits, advances from the Federal
Home Loan Bank and maturities of its existing investments including
mortgage loans, mortgage-backed securities, investment securities
and collateralized mortgage obligations. The Company offers competitive
interest rates to maintain its core deposit base consisting of
passbook savings, checking accounts and certificates of deposit.
The Company does not utilize brokered deposits nor does it offer
special rates for "jumbo" deposits of $100,000 or more.
Gradual increases in interest rates have slowed prepayments of
many of the Companys assets during 2000. This has helped
boost yields, particularly for short-term investments and the
Companys portfolio of CMOs.

The Company, through the Association, is required under Federal
regulations to maintain certain levels of liquid investments.
Qualifying investments include United States Treasury and Federal
Agency securities and other similar instruments having maturities
of five years or less. The level of such investments may not be
less than 4% of the Associations average withdrawable obligations
as defined by the OTS. As of December 31, 2000, the Associations
liquidity stood at 57.06%, or $58.3 million in excess of the minimum
requirement.

Guaranty Savings & Homestead Association, the Companys
wholly-owned subsidiary, is required to maintain regulatory capital
sufficient to meet all three of the regulatory capital requirements,
those being tangible capital (1.5%), core capital (3.0%), and
risk-based capital (8.0%). As of December 31, 2000, the Associations
tangible and core capital amounted to $24.2, million or 16.2%
of adjusted total assets, while the Associations risk-based
capital was $24.6 million, or 39.5% of total adjusted risk-weighted
assets. Even though dividends declared and paid to the Company
have reduced the capital level of the Association, the Company
remains "well capitalized" under OTS standards. Since
the initial public offering in 1997, the Company has endeavored
to reduce its capital level through stock buybacks , retail or
wholesale asset growth and other means.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Item 8 of the Form 10-K is hereby amended and restated in its
entirety to read as follows:





To The Board of Directors

GS Financial Corp. and Subsidiaries

Independent Auditor's Report

We have audited the accompanying consolidated balance sheets
of GS FINANCIAL CORP.and its wholly-owned subsidiary,GUARANTY SAVINGS AND HOMESTEAD ASSOCIATION as of December
31, 2000 and 1999, and the related consolidated statements of
income, comprehensive income (loss), changes in stockholders
equity, and cash flows for each of the three years in the period
ended December 31, 2000. These financial statements are the
responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable
basis for our opinion.

In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated financial
position of GS FINANCIAL CORP.and its wholly-owned subsidiary,GUARANTY SAVINGS AND HOMESTEAD ASSOCIATION as of December
31, 2000 and 1999, and the consolidated results of their operations
and their cash flows for each of the three years in the period
ended December 31, 2000, in conformity with generally accepted
accounting principles.





January 15, 2001

Metairie, Louisiana









|GS FINANCIAL CORP.                                     
|-------------------------------------------------------
|CONSOLIDATED BALANCE SHEETS                            
|(Dollars in Thousands)                                 
|                                                       
|ASSETS                                                 
|                                                       
|                                                       
|                                                       
|                                                       
|CASH AND CASH EQUIVALENTS                              
|                                                       
|                                                       
|                                                       
|                                                       
|                                                       
|                                                       
|Securities Available-for-Sale, at Fair Value           
|Mortgage-Backed Securities Available-for-Sale,         
|                                                       
|Collateralized Mortgage Obligations Available-for-Sale,
|                                                       
|Loans, Net                                             
|Accrued Interest Receivable                            
|Premises and Equipment, Net                            
|Real Estate Held-for-Investment                        
|Stock in Federal Home Loan Bank, at Cost               
|Foreclosed Real Estate                                 
|Deferred Charges                                       
|Other Assets                                           
|                                                       
|                                                       









|LIABILITIES AND STOCKHOLDERS' EQUITY
|------------------------------------
|                                    
|                                    
|                                    
|                                    
|LIABILITIES                         
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|STOCKHOLDERS' EQUITY                
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    







|GS FINANCIAL CORP.               
|---------------------------------
|CONSOLIDATED STATEMENTS OF INCOME
|(Dollars in Thousands)           
|                                 
|                                 
|                                 
|                                 
|                                 
|                                 
|INTEREST INCOME                  
|                                 
|                                 
|                                 
|                                 
|                                 
|                                 
|                                 
|                                 
|                                 
|INTEREST EXPENSE                 
|                                 
|                                 
|                                 
|                                 
|                                 
|NET INTEREST INCOME BEFORE       
|                                 
|                                 
|PROVISION FOR LOAN LOSSES        
|                                 
|NET INTEREST INCOME AFTER        
|                                 
|                                 
|NON-INTEREST INCOME              
|                                 
|                                 
|                                 
|                                 







|GS FINANCIAL CORP.                           
|---------------------------------------------
|CONSOLIDATED STATEMENTS OF INCOME (Continued)
|(Dollars in Thousands)                       
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|NON-INTEREST EXPENSES                        
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|                                             
|INCOME BEFORE INCOME TAX                     
|                                             
|                                             
|INCOME TAX EXPENSE                           
|                                             
|NET INCOME                                   
|                                             
|EARNINGS PER SHARE - BASIC                   
|                                             
|EARNINGS PER SHARE - DILUTED                 





|GS FINANCIAL CORP.                                        
|----------------------------------------------------------
|CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
    (LOSS)
|(Dollars in Thousands)                                    
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|NET INCOME                                                
|                                                          
|OTHER COMPREHENSIVE INCOME,                               
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|                                                          
|COMPREHENSIVE INCOME (LOSS)                               
|                                                          





|GS FINANCIAL CORP.                                            
|--------------------------------------------------------------
|CONSOLIDATED STATEMENTS OF CHANGES
    IN STOCKHOLDERS' EQUITY
|For The Years Ended December 31,
    2000, 1999 and 1998      
|(Dollars in Thousands)                                        
|                                                              
|                                                              
|                                                              
|                                                              
|BALANCES AT DECEMBER 31, 1997                                 
|                                                              
|Distribution of                                               
|                                                              
|                                                              
|Common Stock Released                                         
|                                                              
|                                                              
|Common Stock Acquired by Recognition                          
|                                                              
|                                                              
|Purchase of Treasury Stock                                    
|                                                              
|Dividends Declared                                            
|                                                              
|Net Income - Year Ended                                       
|                                                              
|                                                              
|Other Comprehensive Income (Loss), Net of Applicable          
|                                                              
|BALANCES AT DECEMBER 31, 1998                                 
|                                                              
|Distribution of                                               
|                                                              
|                                                              
|Common Stock Released                                         
|                                                              
|                                                              
|Purchase of Treasury Stock                                    
|                                                              
|Dividends Declared                                            
|                                                              
|Net Income - Year Ended                                       
|                                                              
|                                                              
|Other Comprehensive Income (Loss), Net of Applicable          
|                                                              
|BALANCES AT DECEMBER 31, 1999                                 
|                                                              
|Distribution of                                               
|                                                              
|                                                              
|Common Stock Released                                         
|                                                              
|                                                              
|Purchase of Treasury Stock                                    
|                                                              
|Dividends Declared                                            
|                                                              
|Net Income - Year Ended                                       
|                                                              
|                                                              
|Other Comprehensive Income (Loss), Net of Applicable          
|                                                              
|BALANCES AT DECEMBER 31, 2000                                 







|GS FINANCIAL CORP.                       
|-----------------------------------------
|CONSOLIDATED STATEMENTS OF CASH
    FLOWS
|(Dollars in Thousands)                   
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|CASH FLOWS FROM OPERATING ACTIVITIES     
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         







|GS FINANCIAL CORP.                                   
|-----------------------------------------------------
|CONSOLIDATED STATEMENTS OF CASH
    FLOWS (continued)
|(Dollars in Thousands)                               
|                                                     
|                                                     
|                                                     
|2000                                                 
|CASH FLOWS FROM INVESTING ACTIVITIES                 
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     









|GS FINANCIAL CORP.                                   
|-----------------------------------------------------
|CONSOLIDATED STATEMENTS OF CASH
    FLOWS (Continued)
|(Dollars in Thousands)                               
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|CASH FLOWS FROM FINANCING ACTIVITIES                 
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|NET INCREASE (DECREASE) IN CASH AND                  
|                                                     
|                                                     
|CASH AND CASH EQUIVALENTS - Beginning of Year        
|                                                     
|CASH AND CASH EQUIVALENTS - End of Year              
|                                                     
|                                                     
|SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                     





NOTE A

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

GS Financial Corp. (the "Company") was organized
as a Louisiana corporation on December 24, 1996 for the purpose
of becoming the holding company of Guaranty Savings and Homestead
Association (the "Association") in anticipation of converting
the Association from a Louisiana chartered mutual savings and
loan association to a Louisiana chartered stock savings and loan
association. Other than steps related to the reorganization described
below, the Company was essentially inactive until April 1, 1997,
when it acquired the Association in a business reorganization
of entities under common control in a manner similar to a pooling
of interest.The acquired Association became a wholly-owned
subsidiary of the Company as part of the conversion through the
exchange of 1,000 shares of common stock that consists of 100
percent of the outstanding stock of the Association. The Association
operates in the savings and loan industry and as such provides
financial services primarily to individuals, mainly through the
origination of loans on one to four family residences, and the
acceptance of deposits in the form of passbook savings, certificates
of deposit, and demand deposit accounts.

The Association is subject to competition from other financial
institutions, and is also subject to the regulations of certain
Federal and State agencies and undergoes periodic examinations
by those regulatory authorities.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include
the accounts of the Company and its wholly-owned subsidiary, Guaranty
Savings and Homestead Association. In consolidation, significant
inter-company accounts, transactions, and profits have been eliminated.

BASIS OF FINANCIAL STATEMENT PRESENTATION

The financial statements have been prepared in conformity with
generally accepted accounting principles. In preparing the financial
statements, management is required to make estimates and assumptions
that affect the reported amounts of assets and liabilities as
of the date of the statement of financial condition and revenues
and expenses for the year. Actual results could differ significantly
from those estimates.

Material estimates that are particularly susceptible to significant
change relate to the determination of the allowance for losses
on loans and valuation of real estate acquired in connection with
foreclosures or in satisfaction of loans. Management independently
determines the allowance for losses on loans based on an evaluation
of the loan history and the condition of the underlying properties.
In connection with the determination of the allowances for losses
on foreclosed real estate, management obtains independent appraisals
for all properties.



While management uses available information to recognize losses
on loans and foreclosed real estate, future additions to the allowances
may be necessary based on changes in local economic conditions.
In addition, regulatory agencies, as an integral part of their
examination process, periodically review the Associations
allowances for losses on loans and foreclosed real estate. Such
agencies may require the Association to recognize additions to
the allowances based on their judgments about information available
to them at the time of their examination.

CASH AND CASH EQUIVALENTS

For the purposes of presentation in the consolidated statements
of cash flows, cash and cash equivalents include all cash and
amounts due from depository institutions, interest-bearing deposits
in other banks, and Federal Funds Sold.

INVESTMENT SECURITIES

Marketable securities are classified as available-for-sale
and are carried at fair value. Unrealized gains and losses on
securities available-for-sale are recognized as direct increases
or decreases in comprehensive income. The cost of securities sold
is recognized using the specific identification method. Premiums
and discounts are being amortized over the life of the securities
as a yield adjustment.

MORTGAGE-BACKED SECURITIES

Mortgage-backed securities represent participating interests
in pools of first mortgage loans originated and serviced by issuers
of the securities. Unrealized gains and losses on mortgage-backed
securities are recognized as direct increases or decreases in
comprehensive income. The cost of securities sold is recognized
using the specific identification method. Premiums and discounts
are being amortized over the life of the securities as a yield
adjustment. During 2000, the Company held mortgage-backed securities
issued by the Government National Mortgage Association, the Federal
Home Loan Mortgage Corporation, and the Federal National Mortgage
Association.

COLLATERALIZED MORTGAGE OBLIGATIONS

Collateralized Mortgage Obligations (CMOs) are multiple
class mortgage-backed securities. An underlying pool of mortgages
held by the issuer serves as collateral for the debt obligations,
and principal and interest payments from the pool of mortgages
are used to retire the CMOs.

Currently, the Companys investment in CMOs is limited
to first-tranche Real Estate Mortgage Investment Conduits (REMICs).
A REMIC is a pass-through investment vehicle created under the
Tax Reform Act of 1986 to issue multiple class mortgage-backed
securities. The multiple classes in a REMIC are known as "tranches".

Currently, the Companys investment in REMICs is
limited to those issued by FNMA, FHLMC and "AAA" rated
non-governmental agencies. These are defined to be within the
20% risk-weighted category for thrift institutions. Prior to investing,
the Company receives a prospectus that includes the various cash
flow and interest rate risk scenarios possible for each bond.

Unrealized gains and losses on CMOs are recognized as
direct increases or decreases in comprehensive income. The cost
of securities sold is recognized using the specific identification
method. Premiums and discounts are being amortized over the life
of the securities as a yield adjustment.

LOANS

Loans are stated at unpaid principal balances, less the allowance
for loan losses and net deferred loan fees.

Loan origination and commitment fees, as well as certain direct
origination costs, are deferred and amortized as a yield adjustment
over the contractual lives of the related loans using the interest
method.

Loans are placed on non-accrual when principal or interest
is delinquent for 90 days or more. Any unpaid interest previously
accrued on those loans is reversed from income, and thereafter
interest is recognized only to the extent of payments received.

A loan is considered impaired when, based on current information
and events, it is probable that a creditor will be unable to collect
all amounts due according to the contractual terms of the loan
agreement. Interest payments on impaired loans are typically applied
to principal unless collectibility of the principal amount is
fully assured, in which case interest is recognized on the cash
basis. Residential mortgage loans and consumer installment loans
are considered to be groups of smaller balance homogeneous loans
and are collectively evaluated for impairment and are not subject
to SFAS 114 measurement criteria.

The allowance for loan losses is maintained at a level that,
in managements judgment, is adequate to absorb probable
losses inherent in the loan portfolio. The amount of the allowance
is based on managements evaluation of the collectibility
of the loan portfolio, including the nature of the portfolio,
credit concentrations, trends in historical loss experience, specific
impaired loans, and economic conditions. The allowance is increased
by a provision for loan losses, which is charged to expense, and
reduced by charge-offs, net of recoveries. Changes in the allowance
relating to impaired loans are charged or credited to the provision
for loan losses.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated
depreciation computed principally on the straight-line and modified
accelerated cost recovery methods over the estimated useful lives
of the assets which range from 5 to 10 years for furniture and
equipment, and 31 to 39 years for buildings. Maintenance and repairs
are expensed as incurred, while major additions and improvements
are capitalized.

When these assets are retired or otherwise disposed of, the
cost and related accumulated depreciation or amortization are
removed from the accounts, and any resulting gain or loss is reflected
in income for the period.



FORECLOSED REAL ESTATE

Foreclosed real estate includes real estate acquired in settlement
of loans. At the time of foreclosure, foreclosed real estate is
recorded at the lower of the Associations cost or the assets
fair value, less estimated selling costs, which becomes the propertys
new basis. After foreclosure, valuations are periodically performed
by management and the real estate is carried at the lower of cost
or fair value less estimated selling costs. Costs incurred in
maintaining foreclosed real estate are included in income (loss)
on foreclosed real estate.

REAL ESTATE HELD-FOR-INVESTMENT

Real estate held-for-investment consists of the land and building
of a former branch location of the Association. Due to regulatory
considerations, the Association sold this property to the Company
during 1998 at fair value. The gain on the sale realized by the
Association is eliminated through consolidation. During 2000,
the Company transferred the remaining book value of the building
to land. The Company plans to redevelop this property in 2001,
and all existing structures are to be demolished.

INCOME TAXES

The Company and its wholly-owned subsidiary file a consolidated
Federal income tax return on a calendar year basis. Each entity
pays its pro rata shares of income taxes in accordance with a
written tax-sharing agreement.

Income taxes are provided for the tax effects of the transactions
reported in the financial statements and consist of taxes currently
due plus deferred taxes related to differences between the basis
of assets and liabilities for financial and income tax reporting.
The deferred tax assets and liabilities represent the future tax
return consequences of those differences, which will either be
taxable or deductible when the assets and liabilities are recovered
or settled. Deferred tax assets are reduced by a valuation allowance
when, in the opinion of management, it is more likely than not
that some portion of the deferred tax asset will not be realized.
Deferred tax assets and liabilities are adjusted for the effect
of changes in tax laws and rates on the date of enactment.

While the Association is exempt from Louisiana income tax,
it is subject to the Louisiana Ad Valorem tax that is based on
stockholders equity and net income.

NON-DIRECT RESPONSE ADVERTISING COSTS

The Company expenses advertising costs as incurred. Advertising
cost were $95,000, $69,000 and $78,000 for the years ended December
31, 2000, 1999 and 1998, respectively.

NEW ACCOUNTING STANDARDS

Statement of Financial Accounting Standards No. 138 (SFAS 138),
Accounting for Certain Derivative Instruments and Certain Hedging
Activities, an amendment of SFAS 133, is effective for the
quarter beginning after June 15, 2000. This statement addresses
a limited number of issues causing implementation difficulties
for entities that apply SFAS 133, which requires all derivatives
to be recognized at fair value as either assets or liabilities
in the consolidated balances sheets. Changes in the fair value
of derivatives not designated as hedging instruments are to be
recognized currently in earnings. Gains or losses on derivatives
designated as hedging instruments are either to be recognized
currently in earnings or are to be recognized as a component of
other comprehensive income, depending on the intended use of the
derivatives and the resulting designation. Adoption of this pronouncement
had no effect on the financial position and results of operations
of the Company.

Statement of Financial Accounting Standards No. 140 (SFAS 140),
Accounting for Transfers and servicing of Financial Assets
and Extinguishments of Liabilities, is a replacement of SFAS
125. This statement provides accounting and reporting standards
for transfers and servicing of financial assets and extinguishments
of liabilities. Those standards are based on consistent application
of a financial-components approach that focuses on control. Under
this approach, after a transfer of financial assets, an entity
recognizes the financial and servicing assets it controls and
the liabilities it has incurred, derecognizes financial assets
when control has been surrendered, and derecognizes liabilities
when extinguished. This statement provides consistent standards
for distinguishing transfers of financial assets that are sales
from transfers that are secured borrowings. This statement is
effective for transfers and servicing of financial assets and
extinguishments of liabilities occurring after March 31, 2001
and for recognition and reclassification of collateral and for
disclosures relating to securitization transactions and collateral
for years ending after December 15, 2000. The adoption of this
pronouncement had no effect on the financial position and results
of operations of the Company.



NOTE B

INVESTMENT SECURITIES

Securities available-for-sale consist of the following (in
thousands):



|                           | December 31, 2000    |       | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|-------------------------- | -------------------- | ----- | -------------- | ---------------------- | ----------------------- | ---------------
|                           |                      |       | ----------     |                        | ----------              |                
|U. S. Government           |                      |       |                |                        |                         |                
|                           | and Federal Agencies | $     | 2,389          | $                      | 72                      | $              
|Adjustable Rate            |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 2,831          |                        | -                       |                
|Intermediate               |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 400            |                        | -                       |                
|                           |                      |       |                |                        |                         |                
|FHLMC Common Stock         |                      | 25    |                | 1,767                  |                         | -              
|FHLMC Preferred Stock      |                      | 3,506 |                |                        |                         | 2              
|Equity Investments - Other |                      | 50    |                | -                      |                         | -              
|                           |                      |       | -------        |                        | -------                 |                
|                           |                      | $     | 9,201          | $                      | 1,839                   | $              
|                           |                      |       | =====          |                        | =====                   |                
|                           |                      |       |                |                        |                         |                
|                           | December 31, 1999    |       | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|                           |                      |       | ----------     |                        | ----------              |                
|U. S. Government           |                      |       |                |                        |                         |                
|                           | and Federal Agencies | $     | 4,678          | $                      | 35                      | $              
|Adjustable Rate            |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 1,390          |                        | -                       |                
|Intermediate               |                      |       |                |                        |                         |                
|                           | Mortgage Mutual Fund |       | 2,972          |                        | -                       |                
|                           |                      |       |                |                        |                         |                
|FHLMC Common Stock         |                      | 35    |                | 1,659                  |                         | -              
|                           |                      |       | -------        |                        | -------                 |                
|                           |                      | $     | 9,075          | $                      | 1,694                   | $              
|                           |                      |       | =====          |                        | =====                   |                



The following is a summary of maturities of securities available-for-sale
(in thousands):



|                     |                                    | December 31,                         
|-------------------- | ---------------------------------- | -------------------------------------
|                     |                                    | 2000
    SecuritiesAvailable-for-Sale
|                     |                                    |                                      
|                     |                                    |                                      
|Amounts Maturing in: |                                    |                                      
|                     | In One Year or Less                |                                      
|                     | After One Year Through Five Years  |                                      
|                     | After Five Years Through Ten Years |                                      
|                     |                                    |                                      
|                     |                                    |                                      
|                     |                                    |                                      

The Company is holding agency securities in the amount of $500,000
that are callable in 2001. The Company is holding FHLMC preferred
stock callable in 2004 and 2009.



During 2000, the Company realized losses of $210,000 through
the redemption of $2.6 million of its Intermediate Mortgage Mutual
Fund. The Company also sold 10,000 shares of FHLMC common stock
for $413,000, realizing a gain of $403,000. During 1999, the Company
realized losses of $13,387 through the redemption of $3.1 million
of its Adjustable Rate Mortgage Fund. During 1998, the Company
realized losses of $57,565 through the net redemption of $11.5
million of its Adjustable Rate Mortgage Fund.

Included in other assets are two equity securities being carried
at cost of $27,000. The fair value for these securities approximates
cost.





NOTE C

MORTGAGE-BACKED SECURITIES

Mortgage-backed securities consist of the following (in thousands):



|December 31, 2000   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|------------------- | - | -------------- | ---------------------- | ----------------------- | ---------------
|                    |   | ----------     |                        | ----------              |                
|Available for Sale: |   |                |                        |                         |                
|FNMA                | $ | 1,481          | $                      | -                       | $              
|FHLMC               |   | 1,096          |                        | -                       |                
|GNMA                |   | 1,541          |                        | 4                       |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 4,118          | $                      | 4                       | $              
|                    |   | =====          |                        | =====                   |                
|                    |   |                |                        |                         |                
|December 31, 1999   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|                    |   | ----------     |                        | ----------              |                
|Available for Sale: |   |                |                        |                         |                
|FNMA                | $ | 5,255          | $                      | 1                       | $              
|FHLMC               |   | 1,328          |                        | 3                       |                
|GNMA                |   | 10,160         |                        | -                       |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 16,743         | $                      | 4                       | $              
|                    |   | =====          |                        | =====                   |                







The amortized cost and fair value of mortgage-backed securities
at December 31, 2000 and 1999, by contractual maturity, are shown
below (in thousands). Expected maturities will differ from contractual
maturities because borrowers may have the right to call or prepay
obligations without call or prepayment penalties.



|                                     | December 31, 2000                  |   | Amortized Cost | Fair Value
|------------------------------------ | ---------------------------------- | - | -------------- | ----------
|                                     |                                    |   | ---------      |           
|Mortgage-Backed Securities Maturing: |                                    |   |                |           
|                                     | In One Year or Less                | $ | 230            | $         
|                                     | After One Year Through Five Years  |   | 814            |           
|                                     | After Five Years Through Ten Years |   | 1,187          |           
|                                     | After Ten Years                    |   | 1,887          |           
|                                     |                                    |   | ------         |           
|                                     |                                    | $ | 4,118          | $         
|                                     |                                    |   | =====          |           

|                                     | December 31, 1999                  |   | Amortized Cost | Fair Value
|------------------------------------ | ---------------------------------- | - | -------------- | ----------
|                                     |                                    |   | ---------      |           
|Mortgage-Backed Securities Maturing: |                                    |   |                |           
|                                     | In One Year or Less                | $ | 112            | $         
|                                     | After One Year Through Five Years  |   | 1,411          |           
|                                     | After Five Years Through Ten Years |   | 1,403          |           
|                                     | After Ten Years                    |   | 13,817         |           
|                                     |                                    |   | --------       |           
|                                     |                                    | $ | 16,743         | $         
|                                     |                                    |   | =====          |           

In 2000, the Company sold GNMA and FNMA mortgage-backed securities
with a book value of $10,581,506 , resulting in a loss of $337,000.
There were no sales of mortgage-backed securities in 1999. During
1998, the Company sold mortgage-backed securities with a book
value of $12,387,568 for $12,646,040. This resulted in a realized
gain of $258,471.





NOTE D

COLLATERALIZED MORTGAGE OBLIGATIONS

Collateralized Mortgage Obligations (CMOs) consist of
the following (in thousands):



|December 31, 2000   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|------------------- | - | -------------- | ---------------------- | ----------------------- | ---------------
|                    |   | ----------     |                        | ----------              |                
|Available-for-Sale: |   |                |                        |                         |                
|FNMA                | $ | 5,766          | $                      | -                       | $              
|FHLMC               |   | 14,254         |                        | 196                     |                
|GNMA                |   | 33,562         |                        | 583                     |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 53,582         | $                      | 779                     | $              
|                    |   | =====          |                        | =====                   |                

|December 31, 1999   |   | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair 
    Value
|------------------- | - | -------------- | ---------------------- | ----------------------- | ---------------
|                    |   | ----------     |                        | ----------              |                
|Available-for-Sale: |   |                |                        |                         |                
|FNMA                | $ | 8,058          | $                      | -                       | $              
|FHLMC               |   | 17,347         |                        | 167                     |                
|GNMA                |   | 28,493         |                        | 15                      |                
|                    |   | -------        |                        | -------                 |                
|                    | $ | 53,898         | $                      | 182                     | $              
|                    |   | =====          |                        | =====                   |                

At December 31, 2000 and 1999, CMOs are classified as
available-for-sale, and are reported on the financial statements
at their fair value. Also, all of the CMOs held as of December
31, 2000 and 1999 have contractual maturities of greater than
ten years. There were no sales of CMOs during 2000, 1999
and 1998.

At December 31, 2000, a CMO with a market value of $766,073
has been pledged as collateral towards the outstanding balance
of Advances from the Federal Home Loan Bank.





NOTE E

LOANS

Loans at December 31, 2000 and 1999 are summarized as follows
(in thousands):



|                      |                        |                         |       | December 31,
|--------------------- | ---------------------- | ----------------------- | ----- | ------------
|                      |                        |                         |       | 2000        
|First Mortgage Loans: |                        |                         |       |             
|                      | One to Four            |                         |       |             
|                      |                        | Family Residential      | $     | 71,092      
|                      | FHA and VA             |                         | 52    |             
|                      | Construction           |                         | 619   |             
|                      | Commercial Real Estate |                         | 1,006 |             
|                      | Other                  |                         | 1,453 |             
|                      |                        |                         |       | ---------   
|                      |                        | Total Real Estate Loans |       | 74,222      
|                      |                        |                         |       |             
|Consumer Loans:       |                        |                         |       |             
|                      | Second Mortgage        |                         | 52    |             
|                      | Loans on Deposits      |                         | 237   |             
|                      |                        |                         |       | ---------   
|                      |                        | Total Consumer Loans    |       | 289         
|                      |                        |                         |       |             
|Commercial Loans      |                        | 381                     |       | -           
|                      |                        |                         |       | ---------   
|                      |                        |                         |       | 74,892      
|                      |                        |                         |       |             
|Allowance for         |                        |                         |       |             
|                      | Loan Losses            |                         | (420) |             
|                      |                        |                         |       |             
|Net Deferred Loan     |                        |                         |       |             
|                      | Origination Costs      |                         | 8     |             
|                      |                        |                         |       | ---------   
|Net Loans             | $                      | 74,480                  | $     | 70,066      
|                      |                        |                         |       | =====       





An analysis of the allowance for loan losses as follows (in
thousands):



|                     |         |      | Years Ended December 31,
|-------------------- | ------- | ---- | ------------------------
|                     |         |      | 2000                    
|                     |         |      | -----                   
|Balance, Beginning   |         |      |                         
|                     | of Year | $    | 424                     
|Provision for Losses |         | 7    |                         
|Loans Charged Off    |         | (11) |                         
|Recoveries           |         | -    |                         
|                     |         |      | -----                   
|Balance, End of Year | $       | 420  | $                       
|                     |         |      | ====                    

Loans receivable as of December 31, 2000 are scheduled to mature
and adjustable rate loans are scheduled to reprice as follows
(in thousands):



|                            |              |     | Under 
    One 
    Year | One to 
    Five 
    Years | Six 
    to Ten Years | Over 
    10 
    Years | Total 
|--------------------------- | ------------ | --- | ------------------------ | --------------------------- | --------------------- | ----------------------- | ------
|                            |              |     | ------                   |                             | ------                |                         | ------
|Loans Secured by 1-4 Family |              |     |                          |                             |                       |                         |       
|                            | Residential: |     |                          |                             |                       |                         |       
|Fixed Rate                  | $            | 65  | $                        | 2,054                       | $                     | 9,740                   | $     
|Other Loans Secured by      |              |     |                          |                             |                       |                         |       
|                            | Real Estate: |     |                          |                             |                       |                         |       
|Fixed Rate                  |              | 32  |                          | 111                         |                       | 331                     |       
|Commercial Fixed Rate       |              | 99  |                          | -                           |                       | -                       |       
|All Other Loans             |              | 237 |                          | -                           |                       | -                       |       
|                            |              |     | ------                   |                             | ------                |                         | ------
|                            |              | $   | 433                      | $                           | 2,165                 | $                       | 10,071
|                            |              |     | =====                    |                             | =====                 |                         | ===== 

At December 31, 2000 and 1999, the Association had loans totaling
approximately $320,000 and $254,000, respectively, for which impairment
had been recognized. The allowance for loan losses related to
these loans totaled $68,000 and $64,000 at December 31, 2000 and
1999, respectively. The amount of interest income that would have
been recorded on loans in non-accrual status at December 31, 2000,
had such loans performed in accordance with their terms, was approximately
$20,000. Such interest foregone for the year ended December 31,
1999 was approximately $3,000.

In the ordinary course of business, the Association has and
expects to continue to have transactions, including borrowings,
with its officers and directors. In the opinion of management,
such transactions were on substantially the same terms, including
interest rates and collateral, as those prevailing at the time
of comparable transactions with other persons and did not involve
more than a normal risk of collectibility or present any other
unfavorable features to the Association.

Loans to such borrowers are summarized as follows (in thousands):



|                     |         |       | December 31,
|-------------------- | ------- | ----- | ------------
|                     |         |       | 2000        
|Balance, Beginning   |         |       |             
|                     | of Year | $     | 904         
|Additions            |         | 602   |             
|Payments and Renewal |         | (52)  |             
|                     |         |       | ---------   
|Balance, End of Year |         | 1,454 |             

The Associations lending activity is concentrated within
the metropolitan New Orleans area and surrounding parishes, with
its major emphasis in the origination of permanent single-family
dwelling loans. Such loans comprise the majority of the Associations
loan portfolio.



NOTE F

ACCRUED INTEREST RECEIVABLE

Accrued interest receivable at December 31, 2000 and 1999 consists
of the following (in thousands):



|                                    |   |     | December 31,
|----------------------------------- | - | --- | ------------
|                                    |   |     | 2000        
|Loans                               | $ | 311 | $           
|Mortgage-Backed Securities          |   | 24  |             
|Collateralized Mortgage Obligations |   | 304 |             
|Investments and Other               |   | 43  |             
|                                    |   |     | ------      
|Totals                              | $ | 682 | $           
|                                    |   |     | ====        





NOTE G

PREMISES AND EQUIPMENT

A summary of premises and equipment follows (in thousands):



|                                          |   | December 31,
|----------------------------------------- | - | ------------
|                                          |   | 2000        
|Land                                      | $ | 781         
|Buildings and Improvements                |   | 2,071       
|Furniture, Fixture and Equipment          |   | 526         
|                                          |   | ------      
|                                          |   | 3,378       
|Accumulated Depreciation and Amortization |   | (851)       
|                                          |   | ------      
|                                          | $ | 2,527       
|                                          |   | ====        



Depreciation expense for the years ended December 31, 2000,
1999 and 1998 was approximately $137,000, $112,000 and $123,000,
respectively.

NOTE H

FORECLOSED REAL ESTATE

A summary of the activity of the Foreclosed Real Estate account
follows:



|                                                     |   | December 31,
|---------------------------------------------------- | - | ------------
|                                                     |   | 2000        
|Balance - Beginning of the Year                      | $ | 14          
|Acquired in Settlement of Loans                      |   | 109         
|Costs Capitalized                                    |   | 8           
|Sales of Foreclosed Real Estate                      |   | (14)        
|Less: Allowance for Losses on Foreclosed Real Estate |   | -           
|                                                     |   | ------      
|                                                     | $ | 117         
|                                                     |   | ====        

Expenses applicable to foreclosed real estate consists of operating
expenses, net of rental income, and gains and losses on sales
of real estate. The Company incurred net expenses associated with
foreclosed real estate of approximately $2,000 for the year ended
December 31, 2000. For the years ended December 31, 1999 and 1998,
the Company recognized net income associated with foreclosed real
estate of approximately $24,000 and $1,000, respectively.





NOTE I

REAL ESTATE HELD-FOR-INVESTMENT

Real estate held-for-investment consists of a former branch
location as summarized below (in thousands):



|                           |   | December 31,
|-------------------------- | - | ------------
|                           |   | 2000        
|Land                       | $ | 211         
|Buildings and Improvements |   | -           
|                           |   | ------      
|                           |   | 211         
|Accumulated Depreciation   |   | -           
|                           |   | ------      
|                           | $ | 211         
|                           |   | ====        

Depreciation expense for each of the years ended December 31,
2000, 1999 and 1998 was $2,000, $3,000 and $1,000, respectively.

During 2000, the Company transferred the remaining book value
of the building to land. The Company plans to redevelop this property
in 2001, and all existing structures are to be demolished.

The Company leased this property on a month-to-month basis
for $1,600 per month. The lease was terminated in March, 1999.
Total rental income recognized was approximately $1,700 and $20,000
for the years ended December 31, 1999 and 1998, respectively.

On February 20, 1998, in response to regulatory considerations,
the Company purchased from the Association a former branch location
and adjoining property for $453,000. The purchase price was based
on the appraised value of the property at the time of the transaction.
This inter-company transaction resulted in a gain to the Association
of approximately $178,000, which is eliminated for the purposes
of these consolidated financial statements.





NOTE J

DEPOSITS

Deposit account balances at December 31, 2000 and 1999 are
summarized as follows:



|                              | Weighted
    Average Rate at |      |      | Year Ended
    December 31, |  
|----------------------------- | ---------------------------- | ---- | ---- | --------------------------- | -
|                              | December 31,                 |      |      | 2000                        |  
|                              | 2000                         |      | 1999 |                             |  
|Balance by Interest Rate:     |                              |      |      |                             |  
|Demand Deposit                |                              |      |      |                             |  
|                              | Accounts                     | 4.64 | %    | N/A                         | %
|Regular Savings               |                              |      |      |                             |  
|                              | Accounts                     | 3.00 | %    | 3.00                        | %
|Certificates of               |                              |      |      |                             |  
|                              | Deposit                      | 5.85 | %    | 5.00                        | %
|                              |                              |      |      |                             |  
|                              |                              |      |      |                             |  
|                              |                              |      |      |                             |  
|Certificate Accounts Maturing |                              |      |      |                             |  
|                              | Under 12 months              |      |      |                             | $
|                              | 12 months to 24 months       |      |      |                             |  
|                              | 24 months to 36 months       |      |      |                             |  
|                              | 36 months to 48 months       |      |      |                             |  
|                              | 48 months to 60 months       |      |      |                             |  
|                              |                              |      |      |                             |  
|                              |                              |      |      |                             |  
|                              |                              |      |      |                             |  

The aggregate amount of deposits with a minimum balance of
$100,000 was approximately $3,928,000 and $1,497,000 at December
31, 2000 and 1999, respectively.

Interest expense for each of the following periods is as follows
(in thousands):





|                 |   | Years EndedDecember 31,
|---------------- | - | -----------------------
|                 |   | 2000                   
|Certificates     | $ | 2,094                  
|Passbook Savings | $ | 572                    
|                 |   |                        
|                 | $ | 2,666                  

The Association held deposits of approximately $653,000 and
$575,000 for officers and directors at December 31, 2000 and 1999,
respectively.



NOTE K

ADVANCES FROM FEDERAL HOME LOAN BANK

Pursuant to collateral agreements with the Federal Home Loan
Bank (FHLB), advances are secured by a blanket floating lien on
first mortgage loans. Total interest expense recognized in 2000,
1999 and 1998, respectively, was $3,209,000, $2,674,000 and $1,616,000.





|Contract Rate  | Advance Total
|-------------- | -------------
|               |              
|4.00% to 4.99% | $            
|5.00% to 5.99% |              
|6.00% to 6.99% |              
|7.00% to 7.99% |              
|               | $            
|               |              



Maturities of Advances at December 31, 2000 for each of the
next five years are as follows (in thousands):



|Year Ending  |   |       
|------------ | - | ------
|December 31, |   | Amount
|2001         | $ | 19,318
|2002         |   | 7,828 
|2003         |   | 8,329 
|2004         |   | -     
|2005         |   | 6,709 
|Thereafter   |   | 12,007
|             | $ | 54,191

NOTE L

INCOME TAX EXPENSE

The provision for income taxes for 2000, 1999 and 1998 consists
of the following (in thousands):



|                     |   | Years EndedDecember 31,
|-------------------- | - | -----------------------
|                     |   | 2000                   
|Current Tax Expense  | $ | 603                    
|Deferred Tax Expense | $ | 63                     
|                     |   |                        
|                     | $ | 666                    

The provision for Federal income taxes differs from that computed
by applying Federal statutory rates to income (loss) before Federal
income tax expense, as indicated in the following analysis (in
thousands):



|                                     |   | Years EndedDecember 31,
|------------------------------------ | - | -----------------------
|                                     |   | 2000                   
|Expected Tax Provision at a 34% Rate | $ | 633                    
|Expected State Corporate Tax         |   | 9                      
|Effect of Tax Exempt Income          |   | (5)                    
|Employee Stock Ownership Plan        |   | 20                     
|Other                                |   | 9                      
|                                     | $ | 666                    

Deferred tax liabilities have been provided for the temporary
differences related to unrealized gains on available-for-sale
securities, deferred loan costs, depreciation, and non-cash Federal
Home Loan Bank dividends. Deferred tax assets have been provided
for the temporary differences related to the Companys Recognition
and Retention Plan and Employee Stock Ownership Plan, unrealized
losses on available-for-sale securities, the allowance for loan
losses, reserves for uncollected interest and late charges, deferred
loan fees, and the allowance for losses on foreclosed real estate.
The net deferred tax assets or liabilities in the accompanying
statements of financial condition include the following components
(in thousands):





|                    |                                |                               | 2000 |   | 1999
|------------------- | ------------------------------ | ----------------------------- | ---- | - | ----
|Deferred Tax Assets |                                |                               |      |  
|                    | Recognition and Retention Plan | $                             | 13   | $ | 13  
|                    | Employee Stock Ownership Plan  |                               | 80   |   | 65  
|                    | Market Value Adjustment to     |                               |      |   |     
|                    |                                | Available-for-Sale Securities |      | - |     
|                    | Other                          |                               | 9    |   | 4   
|                    | Total Deferred Tax Assets      |                               | 102  |   | 381 

|                                                      |                                |                               | 2000  |      | 1999
|----------------------------------------------------- | ------------------------------ | ----------------------------- | ----- | ---- | ----
|Deferred Tax Liabilities                              |                                |                               |       |     
|                                                      | FHLB Stock Dividends           | $                             | 235   | $    | 154 
|                                                      | Market Value Adjustment to     |                               |       |      |     
|                                                      |                                | Available-for-Sale Securities |       | 666  |     
|                                                      | Allowance for Loan Losses      |                               | 187   |      | 191 
|                                                      | Other                          |                               | 58    |      | 53  
|                                                      | Total Deferred Tax Liabilities |                               | 1,146 |      | 398 
|                                                      |                                |                               |       |      |     
|Deferred Tax Liabilities - Net of Deferred Tax Assets | $                              | 1,044                         | $     | 17  
|                                                      |                                | ====                          |       | ====

Included in retained earnings at December 31, 2000 and 1999
is approximately $3,800,000 in bad debt reserves for which no
deferred Federal income tax liability has been recorded. These
amounts represent allocations of income to bad debt deductions
for tax purposes only. Reduction of these reserves for purposes
other than tax bad-debt losses or adjustments arising from carryback
of net operating losses would create income for tax purposes,
which would be subject to the then-current corporate income tax
rate. The unrecorded deferred liability on these amounts was approximately
$1,292,000 for December 31, 2000 and 1999, respectively.



NOTE M

EMPLOYEE STOCK OWNERSHIP PLAN

During 1997, GS Financial Corp. instituted an employee stock
ownership plan (the "ESOP") that covers all employees
of Guaranty Savings and Homestead Association who have completed
one year of service and have attained the age of 21. The ESOP
purchased the statutory limit of eight percent of the shares offered
in the initial public offering of the Company (275,080 shares).
This purchase was facilitated by a loan from the Company to the
ESOP in the amount of $2,750,800. The loan is secured by a pledge
of the ESOP shares. The shares pledged as collateral are reported
as unearned ESOP shares in the balance sheets. The corresponding
note is to be paid back in 40 equal quarterly payments of $103,000
on the last business day of each quarter, beginning June 30, 1997
at the rate of 8.5%. The note payable and the corresponding note
receivable have been eliminated for consolidation purposes.

The Association may contribute to the plan, in the form of
debt service, at the discretion of its board of directors. Dividends
received on ESOP shares are either utilized to service the debt
or credited to participant accounts at the discretion of the trustees
of the Plan. Shares are released for allocation to plan participants
based on principal and interest payments of the note. Compensation
expense is recognized based on the number of shares allocated
to plan participants and the average market price of the stock
for the current year. Released ESOP shares become outstanding
for earnings per share computations.

As compensation expense is incurred, the Unearned ESOP Shares
account is reduced based on the original cost of the stock. The
difference between the cost and average market price of shares
released for allocation is applied to Additional Paid-in Capital.
ESOP compensation expense was approximately $377,000, $355,000
and $521,000 for the years ended December 31, 2000, 1999 and 1998,
respectively.

The ESOP shares as of December 31, 2000 and 1999 were
as follows:



|                                               |   | 2000    |   | 1999   
|---------------------------------------------- | - | ------- | - | -------
|Allocated Shares                               |   | 78,215  |   | 52,268 
|Shares Released for Allocation                 |   | 28,132  |   | 28,132 
|Unreleased Shares                              |   | 164,583 |   | 192,715
|                                               |   |         |   |        
|Total ESOP Shares                              |   | 270,930 |   | 273,115
|                                               |   | ======  |   | ====== 
|Fair Value of Unreleased Shares (in thousands) | $ | 2,397   | $ | 2,361  
|                                               |   | ====    |   | ====   

Total ESOP shares decreased in 2000 and 1999 due to the liquidation
of shares for employees who terminated their employment in 2000
and 1999.





NOTE N

RECOGNITION AND RETENTION PLAN

On October 15, 1997, the Company established a Recognition
and Retention Plan (the "Plan") as an incentive to retain
personnel of experience and ability in key positions. The Company
approved a total of 137,540 shares of stock to be acquired for
the Plan, of which 125,028 shares have been allocated for distribution
to key employees and directors. As shares are acquired for the
Plan, the purchase price of these shares is recorded as unearned
compensation, a contra equity account. As the shares are distributed,
the contra equity account is reduced.

During 1998, by unanimous approval of the Plan participants,
the Plan was amended as a direct effort to reduce the Companys
expenses resulting from the Plan. Prior to the amendment to the
Plan, Plan share awards were earned by recipients at a rate of
20% of the aggregate number of shares covered by the Plan over
five years. The amended Plan stipulates that Plan share awards
are earned by recipients at a rate of 10% of the aggregate number
of shares covered by the plan over ten years. If the employment
of an employee or service as a non-employee director is terminated
prior to the tenth anniversary of the date of grant of Plan share
award for any reason (except for death, disability or retirement),
the recipient shall forfeit the right to any shares subject to
the award which have not been earned.

The total cost associated with the Plan is based on a per share
value of $12.50, the market price of the Companys stock
as of the date on which the Plan was amended. This cost is being
amortized over ten years. Compensation expense pertaining to the
Recognition and Retention plan was $156,000, $156,000 and $103,000
for the years ended December 31, 2000, 1999 and 1998, respectively.



A summary of the changes in restricted stock follows:



|                             | UnawardedShares | AwardedShares
|---------------------------- | --------------- | -------------
|Balance at January 1, 1999   | 12,472          | 112,529      
|Purchased by Plan            | -               | -            
|Granted                      | -               | -            
|Forfeited                    | -               | -            
|Earned and Issued            | -               | (12,501)     
|                             |                 |              
|Balance at December 31, 1999 | 12,472          | 100,028      
|Purchased by Plan            | -               | -            
|Granted                      | -               | -            
|Forfeited                    | -               | -            
|Earned and Issued            | -               | (12,506)     
|                             |                 |              
|Balance at December 31, 2000 | 12,472          | 87,522       
|                             | =====           | =====        



NOTE O

STOCK OPTION PLAN

In 1997, the Company adopted a stock option plan for the benefit
of directors, officers, and other key employees. The number of
shares of common stock reserved for issuance under the stock option
plan was 343,850 shares, or ten percent of the total number of
shares of common stock sold in the Companys initial public
offering of its common stock.



The plan also permits the granting of Stock Appreciation Rights
(SARs). SARs entitle the holder to receive, in the
form of cash or stock, the increase in the fair value of the Company
stock from the date of grant to the date of exercise. No SARs
have been issued under the plan.



On October 15, 1997, the Company granted a total of 275,076
options to directors, officers, and other key employees. Under
the plan, the exercise price of each option cannot be less than
the fair value of the underlying common stock as of the date of
the option grant, and the maximum term is 10 years. Options vest
over five years.





The Company accounts for the plan under the guidance of Accounting
Principles Board (APB) Opinion No. 25, Accounting for Stock
Issued to Employees. No compensation costs has been recognized
in the financial statements of the Company since the exercise
option price cannot be less than market price of the stock at
the date of the grant. However, SFAS No. 123, Accounting for
Stock-Based Compensation, requires the disclosure of the compensation
costs for stock-based incentives granted after January 31, 1995
based on the fair value at the grant date for awards. Applying
SFAS No. 123 would result in pro forma net income and earnings
per share amounts as follows:





|                          | 2000         | 1999   | 1998  
|------------------------- | ------------ | ------ | ------
|Net Income (In thousands) |              |        |       
|                          | As Reported  | $1,195 | $1,375
|                          | Pro Forma    | 607    | 1,056 
|                          |              |        |       
|Earnings per Share        |              |        |       
|                          | As Reported: |        |       
|                          | Basic        | $.60   | $.58  
|                          | Diluted      | .60    | .58   
|                          | Pro Forma:   |        |       
|                          | Basic        | .31    | .44   
|                          | Diluted      | .31    | .44   



The fair value of options granted on October 15, 1997 was estimated
as of the date of the grant using the Black-Scholes option-pricing
model with the following assumptions: dividend yield of 1.59%;
expected volatility of 16.2%; risk-free interest rate of 6.14%;
and life of 9.88 years.



A summary of the status of the Companys stock option
plan as of December 31, 2000, 1999, and 1998, and changes during
the years ending on those dates is presented below:





|                                 |           |          |      |          |          |  |           |         
|-------------------------------- | --------- | -------- | ---- | -------- | -------- |  | --------- | --------
|                                 | 2000      |          | 1999 |          | 1998    
|                                 |           | Exercise |      |          | Exercise |  |           | Exercise
|Fixed Options                    | Shares    | Price    |      | Shares   | Price    |  | Shares    | Price   
|                                 |           |          |      |          |          |  |           |         
|Outstanding at Beginning of Year | 275,076   | $ 17.18  |      | 275,076  | $ 17.18  |  | 275,076   | $ 17.18 
|Granted                          | -         |          |      | -        |          |  | -         |         
|Exercised                        | -         |          |      | -        |          |  | -         |         
|Forfeited                        | -         |          |      | -        |          |  | -         |         
|                                 | --------- |          |      | -------- |          |  | --------- |         
|Outstanding at End of Year       | 275,076   | $ 17.18  |      | 275,076  | $ 17.18  |  | 275,076   | $ 17.18 
|                                 | ======    |          |      | =====    |          |  | ======    |         
|Options Exercisable at Year-end  | 176,507   | $ 17.18  |      | 121,492  | $ 17.18  |  | 66,477    | $ 17.18 
|                                 | ======    |          |      | =====    |          |  | ======    |         
|                                 |           |          |      |          |          |  |           |         





The following table summarizes information about fixed stock
options outstanding at December 31, 2000:



|         |  | Options Outstanding |  | Options Exercisable
|-------- |  | ------------------- |  | -------------------
|         |  |                     |  |                    
|         |  | Number              |  | Remaining          
|Exercise |  | Outstanding         |  | Contractual        
|Price    |  | at 12/31/00         |  | Life               
|         |  |                     |  |                    
|$ 17.18  |  | 275,076             |  | 6.8 years          



NOTE P

COMPREHENSIVE INCOME

Comprehensive income was comprised of changes in the Companys
unrealized holding gains or losses on securities available-for-sale
during 2000, 1999 and 1998. The following represents the tax effects
associated with the components of comprehensive income.



|                                        |                               | Years Ended December 31,
|--------------------------------------- | ----------------------------- | ------------------------
|                                        |                               |                         
|Gross Unrealized Holding Gains (Losses) |                               |                         
|                                        | Arising During the Period     | $                       
|Tax (Expense) Benefit                   |                               | (868)                   
|                                        |                               |                         
|                                        |                               |                         
|                                        |                               |                         
|Reclassification Adjustment for (Gains) |                               |                         
|                                        | Losses Included in Net Income |                         
|Tax Expense (Benefit)                   |                               | (96)                    
|                                        |                               |                         
|                                        |                               |                         
|                                        |                               |                         
|Net Unrealized Holding Gains (Losses)   |                               |                         
|                                        | Arising During the Period     | $                       



NOTE Q

FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF
1991 (FDICIA) AND FINANCIAL INSTITUTIONS REFORM, RECOVERY AND
ENFORCEMENT ACT OF 1989 (FIRREA)

FDICIA was signed into law on December 19, 1991. Regulations
implementing the prompt corrective action provisions of FDICIA
became effective on December 19, 1992. In addition to the prompt
corrective action requirements, FDICIA includes significant changes
to the legal and regulatory environment for insured depository
institutions, including reductions in insurance coverage for certain
kinds of deposits, increased supervision by the Federal regulatory
agencies, increased reporting requirements for insured institutions,
and new regulations concerning internal controls, accounting and
operations.

FIRREA was signed into law on August 9, 1989. Regulations for
savings institutions minimum capital requirements went into
effect on December 7, 1989. In addition to its capital requirements,
FIRREA includes provisions for changes in the Federal regulatory
structure for institutions, including a new deposit insurance
system and restricted investment activities with respect to noninvestment
grade corporate debt and certain other investments. FIRREA also
increases the required ratio of housing-related assets in order
to qualify as a savings institution.

The regulations require institutions to have a minimum regulatory
tangible capital equal to 1.5% of adjusted total assets, a minimum
3% core/leverage capital ratio, a minimum 4% tier 1 risk-based
ratio, and a minimum 8% total risk-based capital ratio to be considered
"adequately capitalized." An institution is deemed to
be "critically undercapitalized" if it has a tangible
equity ratio of 2% or less. The ability to include qualifying
supervisory goodwill for purposes of the core/leverage capital
and tangible capital was phased out by July 1, 1995.

The following table sets out the Associations various
regulatory capital categories at December 31, 2000 and 1999.



|                          | 2000        | 1999      
|------------------------- | ----------- | ----------
|                          | Dollars     | Percentage
|                          | (Thousands) |           
|                          |             |           
|Tangible Capital          | $24,199     | 16.22%    
|Tangible Equity           | $24,199     | 16.22%    
|Core/Leverage Capital     | $24,199     | 16.22%    
|Tier 1 Risk-Based Capital | $24,199     | 38.87%    
|Total Risk-Based Capital  | $24,619     | 39.54%    



As of December 31, 2000, the most recent notification from
the FDIC categorized the Association as "well capitalized"
under the regulatory framework for prompt corrective action. To
be "well capitalized", the Association must maintain
minimum leverage capital ratios and minimum amounts of capital
to "risk-weighted" assets, as defined by banking regulators.



NOTE R

REGULATORY CAPITAL

The following is a reconciliation of generally accepted accounting
principles (GAAP) net income and capital to regulatory capital
for the Association. The following reconciliation also compares
the capital requirements as computed to the minimum capital requirements
for the Association.





|              | Net Income for the 
    Year EndedDecember 31, 2000 | Capital as ofDecember 31, 2000
|------------- | --------------------------------------------------- | ------------------------------
|              |                                                     |                               
|Per GAAP      | $1,096                                              |                               
|              | ====                                                |                               
|Total Assets  |                                                     |                               
|              |                                                     |                               
|Capital Ratio |                                                     |                               

|         |                       |                    | TangibleCapital | TangibleEquity | Core/ LeverageEquity | Tier 1 
    Risk-BasedCapital | Total Risk-BasedCapital
|-------- | --------------------- | ------------------ | --------------- | -------------- | -------------------- | ----------------------------- | -----------------------
|Per GAAP | $                     | 25,492             | $               | 25,492         | $                    | 25,492                        | $                      
|         | Assets Required       |                    |                 |                |                      |                               |                        
|         |                       | to be Added:       |                 |                |                      |                               |                        
|         |                       | Unrealized Loss    |                 |                |                      |                               |                        
|         |                       | on Securities      |                 |                |                      |                               |                        
|         |                       | Available-for-Sale |                 | (1,293)        |                      | (1,293)                       |                        
|         |                       |                    |                 |                |                      |                               |                        
|         | Allowance for Loan    |                    |                 |                |                      |                               |                        
|         |                       | Losses             |                 | -              |                      | -                             |                        
|         |                       |                    |                 |                |                      |                               |                        
|         | Regulatory Capital    |                    |                 |                |                      |                               |                        
|         |                       | Measure            | $               | 24,199         | $                    | 24,199                        | $                      
|         |                       |                    |                 | =====          |                      | =====                         |                        
|         |                       |                    |                 |                |                      |                               |                        
|         | Adjusted Total Assets | $                  | 149,217         | $              | 149,217              | $                             | 149,217                
|         |                       |                    |                 | =====          |                      | =====                         |                        
|         |                       |                    |                 |                |                      |                               |                        
|         |                       |                    |                 |                |                      |                               |                        
|         | Risk-Weighted Assets  |                    |                 |                |                      |                               |                        
|         |                       |                    |                 |                |                      |                               |                        
|         | Capital Ratio         |                    | 16.22%          |                | 16.22%               |                               | 16.22%                 
|         |                       |                    |                 |                |                      |                               |                        
|         | Required Ratio        |                    | 1.50%           |                | 2.00%                |                               | 3.00%                  
|         |                       |                    |                 |                |                      |                               |                        
|         | Required Capital      | $                  | 2,238           |                |                      | $                             | 4,476                  
|         |                       |                    |                 | =====          |                      |                               |                        
|         | Excess Capital        | $                  | 21,961          |                |                      | $                             | 19,723                 
|         |                       |                    |                 | =====          |                      |                               |                        







|              | Net Income for the 
    Year EndedDecember 31, 1999 | Capital as ofDecember 31, 1999
|------------- | --------------------------------------------------- | ------------------------------
|              |                                                     |                               
|Per GAAP      | $1,244                                              |                               
|              | ====                                                |                               
|Total Assets  |                                                     |                               
|              |                                                     |                               
|Capital Ratio |                                                     |                               

|         |                       |                    |         |        |         |        |        
|-------- | --------------------- | ------------------ | ------- | ------ | ------- | ------ | -------
|Per GAAP | $                     | 27,007             | $       | 27,007 | $       | 27,007 | $      
|         | Assets Required       |                    |         |        |         |        |        
|         |                       | to be Added:       |         |        |         |        |        
|         |                       | Unrealized Loss    |         |        |         |        |        
|         |                       | on Securities      |         |        |         |        |        
|         |                       | Available-for-Sale |         | 563    |         | 563    |        
|         |                       |                    |         |        |         |        |        
|         | Allowance for Loan    |                    |         |        |         |        |        
|         |                       | Losses             |         | -      |         | -      |        
|         |                       |                    |         |        |         |        |        
|         | Regulatory Capital    |                    |         |        |         |        |        
|         |                       | Measure            | $       | 27,570 | $       | 27,570 | $      
|         |                       |                    |         | =====  |         | =====  |        
|         |                       |                    |         |        |         |        |        
|         | Adjusted Total Assets | $                  | 155,911 | $      | 155,911 | $      | 155,911
|         |                       |                    |         | =====  |         | =====  |        
|         |                       |                    |         |        |         |        |        
|         |                       |                    |         |        |         |        |        
|         | Risk-Weighted Assets  |                    |         |        |         |        |        
|         |                       |                    |         |        |         |        |        
|         | Capital Ratio         |                    | 17.68%  |        | 17.68%  |        | 17.68% 
|         |                       |                    |         |        |         |        |        
|         | Required Ratio        |                    | 1.50%   |        | 2.00%   |        | 3.00%  
|         |                       |                    |         |        |         |        |        
|         | Required Capital      | $                  | 2,339   |        |         | $      | 4,677  
|         |                       |                    |         | =====  |         |        |        
|         |                       |                    |         |        |         |        |        
|         | Excess Capital        | $                  | 25,231  |        |         | $      | 22,893 
|         |                       |                    |         | =====  |         |        |        



NOTE S

COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Association
has various outstanding commitments and contingent liabilities
that are not reflected in the accompanying financial statements.

COMMITMENTS TO EXTEND CREDIT

The Association is a party to credit related
commitments with off-balance sheet risk in the normal course of
business to meet the financing needs of its customers. These consist
of outstanding mortgage and construction loan commitments and
commercial lines of credit. As of December 31, 2000 and 1999,
outstanding mortgage and construction loan commitments were approximately
$955,000 and $2,301,000, respectively. These commitments, normally
extended for thirty days, are for first mortgage or construction
loans at a fixed rate ranging from 6.75% to 9.00%.

EMPLOYMENT CONTRACTS

The chief executive officer and the executive
vice-president of the Association serve under employment contracts
that were approved by the Board of Directors on February 13, 1997.
The contracts were amended on February 10, 2000, to increase the
base salaries and extend the term thereof to February 13, 2003.

OPERATING LEASE

The Association leases an automobile under
an operating lease that expires in July 2003. Total rent expense
incurred under this lease amounted to $4,713, $-0-, and $-0-,
for the years ended December 31, 2000, 1999, and 1998, respectively.





|Year EndingDecember 31, |   | Amount
|----------------------- | - | ------
|2001                    | $ | 8,077 
|2002                    |   | 8,077 
|2003                    |   | 4,711 
|                        |   |       
|Total                   | $ | 20,865
|                        |   |       



NOTE T

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET
RISK

The Association is a party to financial instruments
with off-balance sheet risk in the normal course of business to
meet the financing needs of its customers. These financial instruments
consist of commitments to extend credit. These instruments involve,
to varying degrees, elements of credit and interest rate risk
in excess of the amounts recognized in the balance sheets.

The Associations exposure to credit loss
in the event of nonperformance by the other party to these financial
instruments for commitments to extend credit is represented by
the contractual notional amount of those instruments (see Note
S). The Association uses the same credit policies making commitments
as it does for on-balance sheet instruments.

Commitments to extend credit are agreements
to lend to a customer as long as there is no violation of any
condition established in the contract. Commitments generally have
fixed expiration dates or other termination clauses and may require
payment of a fee. Since many of the commitments are expected to
expire without being drawn upon, the total commitment amount does
not necessarily represent future cash requirements. The Association
evaluates each customers creditworthiness on a case-by-case
basis. The amount and type of collateral obtained varies and is
based on managements credit evaluation of the counterparty.



NOTE U

CONCENTRATION OF CREDIT RISK

The Associations lending activity is
concentrated within the southeastern part of Louisiana. In accordance
with industry practices, the Association has deposits in other
financial institutions for more than the insured limit. These
deposits in other institutions do not represent more than the
normal industry credit risk.



NOTE V

DISCLOSURE ABOUT FAIR VALUE OF FINANCIAL
INSTRUMENTS

The following methods and assumptions were
used to estimate the fair value of each class of financial instruments
for which it is practicable to estimate the value:

The carrying amount of cash and short-term
investments approximate the fair value.

For investment securities, mortgage-backed
securities, and collateralized mortgage obligations, fair value
is based on quoted market prices.

For mortgage loan receivables the fair values
are based on discounted cash flows using current rates at which
similar loans with similar maturities would be made to borrowers
with similar credit risk.

The fair value of savings deposits is calculated
using average rates in the market place at the date of the financial
statements.

For certificates of deposit, fair value is
estimated based on current rates for deposits of similar remaining
maturities.

The fair value of loan commitments is estimated
using rates and fees that would be charged to enter similar agreements,
taking into account (1) the remaining terms of the agreement,
(2) the creditworthiness of the borrowers, and (3) for fixed rate
commitments, the difference between current interest rates and
committed rates.





|                                   |                                        | December 31, 2000 | December 31, 1999
|---------------------------------- | -------------------------------------- | ----------------- | -----------------
|                                   |                                        | CarryingAmount    | FairValue        
|Financial Assets                   |                                        |                   |                  
|                                   | Cash and Short-Term Investments        | $                 | 3,403            
|                                   | Investment Securities                  |                   | 11,000           
|                                   | Mortgage-Backed Securities             |                   | 4,115            
|                                   | Collateral Mortgage Obligations        |                   | 53,745           
|                                   | Loans (Net of Loan Allowance)          |                   | 74,480           
|                                   |                                        |                   |                  
|Financial Liabilities              |                                        |                   |                  
|                                   | Deposits                               | $                 | 58,879           
|                                   | Advances from Federal Home Loan Bank   |                   | 54,191           
|                                   |                                        |                   |                  
|Unrecognized Financial Instruments |                                        |                   |                  
|                                   | Commitments to Extend Credit           | $                 | 400              
|                                   | Unfunded Construction Loan Commitments |                   | 554              
|                                   | Unfunded Commercial Lines of Credit    |                   | 1                



NOTE W

SELECTED QUARTERLY FINANCIAL DATA (Unaudited)

The following sets forth condensed results
of operations for 2000 and 1999 (dollar amounts in thousands,
except per share data):





|                                                                                            |                     |         | First |         | Second |         | Third |         | Fourth
|------------------------------------------------------------------------------------------- | ------------------- | ------- | ----- | ------- | ------ | ------- | ----- | ------- | ------
|2000                                                                                        |                     | Quarter |       | Quarter |        | Quarter |       | Quarter
|                                                                                            |                     |         |       |         |        |         |       |         |       
|Interest Income                                                                             | $                   | 2,798   | $     | 2,822   | $      | 2,848   | $     | 2,794  
|Interest Expense                                                                            |                     | 1,367   |       | 1,402   |        | 1,537   |       | 1,570  
|                                                                                            | Net Interest Income |         | 1,431 |         | 1,420  |         | 1,311 |         | 1,224 
|Provision for Loan Losses                                                                   |                     | -       |       | -       |        | 7       |       | -      
|Other Income                                                                                |                     | (58)    |       | (196)   |        | 292     |       | (167)  
|Other Expense                                                                               |                     | 835     |       | 868     |        | 864     |       | 823    
|Income Tax Expense                                                                          |                     | 206     |       | 133     |        | 272     |       | 55     
|                                                                                            |                     |         |       |         |        |         |       |         |       
|                                                                                            | Net Income          | $       | 332   | $       | 223    | $       | 460   | $       | 179   
|                                                                                            |                     |         |       |         |        |         |       |         |       
|Net Income per Common Share (1)                                                             |                     |         |       |         |        |         |       |        
|                                                                                            | Basic               | $       | 0.14  | $       | 0.11   | $       | 0.26  | $       | 0.11  
|                                                                                            | Dilluted            | $       | 0.14  | $       | 0.11   | $       | 0.26  | $       | 0.11  
|Dividends Per Share                                                                         | $                   | 0.09    | $     | 0.09    | $      | 0.09    | $     | 0.09   
|                                                                                            |                     |         |       |         |        |         |       |         |       
|(1) Quarterly per share amounts do not add to total for the year
    ended due to rounding.
|                                                                                            |                     |         |       |         |        |         |       |         |       
|                                                                                            |                     |         |       |         |        |         |       |         |       
|                                                                                            |                     |         | First |         | Second |         | Third |         | Fourth
|1999                                                                                        |                     | Quarter |       | Quarter |        | Quarter |       | Quarter
|                                                                                            |                     |         |       |         |        |         |       |         |       
|Interest Income                                                                             | $                   | 2,590   | $     | 2,508   | $      | 2,710   | $     | 2,850  
|Interest Expense                                                                            |                     | 1,237   |       | 1,212   |        | 1,363   |       | 1,409  
|                                                                                            | Net Interest Income |         | 1,353 |         | 1,296  |         | 1,347 |         | 1,441 
|Provision for Loan Losses                                                                   |                     | -       |       | -       |        | -       |       | 6      
|Other Income                                                                                |                     | (3)     |       | (8)     |        | 5       |       | 1      
|Other Expense                                                                               |                     | 802     |       | 818     |        | 802     |       | 879    
|Income Tax Expense                                                                          |                     | 200     |       | 161     |        | 130     |       | 259    
|                                                                                            |                     |         |       |         |        |         |       |         |       
|                                                                                            | Net Income          | $       | 348   | $       | 309    | $       | 420   | $       | 298   
|                                                                                            |                     |         |       |         |        |         |       |         |       
|Net Income per Common Share (1)                                                             |                     |         |       |         |        |         |       |        
|                                                                                            | Basic               | $       | 0.13  | $       | 0.13   | $       | 0.18  | $       | 0.13  
|                                                                                            | Dilluted            | $       | 0.13  | $       | 0.13   | $       | 0.18  | $       | 0.13  
|Dividends Per Share                                                                         | $                   | 0.07    | $     | 0.09    | $      | 0.09    | $     | 0.09   
|                                                                                            |                     |         |       |         |        |         |       |         |       
|(1) Quarterly per share amounts do not add to total for the year
    ended due to rounding.





NOTE X

EARNINGS PER COMMON SHARE

Earnings per share are computed using the weighted
average number of shares outstanding. Options to purchase 275,076
shares at $17.18 per share were outstanding during 2000, 1999,
and 1998 but were not included in the computation of diluted earnings
per share because the options exercise price was greater
than the average market value price of the common shares. The
options were still outstanding at December 31, 2000. The Company
had no other securities outstanding during the years ended December
31, 2000, 1999, or 1998 that would have a dilutive effect on earnings
per share.



Average shares outstanding at December 31,
2000, 1999 and 1998 amounted to 1,976,605, 2,383,168, and 2,793,247
respectively.



NOTE Y

CONDENSED FINANCIAL INFORMATION - PARENT
COMPANY ONLY



|GS FINANCIAL CORP.                                             |      
|-------------------------------------------------------------- | -----
|CONDENSED FINANCIAL CONDITION                                  |      
|(Dollars in Thousands)                                         |      
|                                                               |      
|ASSETS                                                         |      
|                                                               |      
|                                                               |      
|Cash and Cash Equivalents                                      | $    
|Investments - Available-for-Sale, at Fair Value                |      
|Mortgage-Backed Securities - Available-for-Sale, at Fair Value | 1,545
|Investment in Subsidiary                                       |      
|Loan Receivable                                                |      
|Dividend Receivable from Subsidiary                            |      
|Deferred Tax Asset                                             |      
|Other Assets                                                   |      
|                                                               |      
|                                                               |      
|                                                               |      
|                                                               |      
|LIABILITIES AND STOCKHOLDERS' EQUITY                           |      
|                                                               |      
|Deferred Tax Liability                                         | $    
|Accrued Income tax                                             |      
|Stockholders' Equity                                           |      
|                                                               |      
|                                                               |      
|                                                               |      







|GS FINANCIAL CORP.       |                                             |                             |         |                    
|------------------------ | ------------------------------------------- | --------------------------- | ------- | -------------------
|STATEMENT OF OPERATIONS  |                                             |                             |         |                    
|(Dollars in Thousands)   |                                             |                             |         |                    
|                         |                                             |                             |         | For the Years Ended
|                         |                                             |                             |         | December 31,       
|                         |                                             |                             |         | 2000               
|INTEREST INCOME          |                                             |                             |         |                    
|                         | Mortgage-Backed Securities                  | $                           | 128     | $                  
|                         | Dividend from Subsidiary                    |                             | 5,000   |                    
|                         | Loans                                       |                             | 173     |                    
|                         | Investment Securities                       |                             | 19      |                    
|                         | Other Interest Income                       |                             | 39      |                    
|                         |                                             |                             |         |                    
|                         |                                             | Total Interest Income       |         | 5,359              
|                         |                                             |                             |         |                    
|NON-INTEREST INCOME      |                                             |                             |         |                    
|                         | Undistributed Earnings of Subsidiary        |                             | (3,904) |                    
|                         | Gain on sale of Mortgage-Backed Securities  |                             | -       |                    
|                         | Income from Real Estate Held-for-Investment |                             | -       |                    
|                         |                                             |                             |         |                    
|                         |                                             | Total Non-Interest Income   |         | (3,904)            
|                         |                                             |                             |         |                    
|NON-INTEREST EXPENSES    |                                             |                             |         |                    
|                         | General and Administrative                  |                             | 59      |                    
|                         | Intercompany Personnel Expense              |                             | 116     |                    
|                         | Taxes                                       |                             | 20      |                    
|                         | Loss on Sale of Investments                 |                             | 10      |                    
|                         | Bank Acquisition Costs Charged Off          |                             | -       |                    
|                         |                                             |                             |         |                    
|                         |                                             | Total Non-Interest Expenses |         | 205                
|                         |                                             |                             |         |                    
|INCOME BEFORE INCOME TAX |                                             | 1,250                       |         | 1,450              
|                         |                                             |                             |         |                    
|PROVISION FOR INCOME TAX |                                             | 55                          |         | 75                 
|                         |                                             |                             |         |                    
|NET INCOME               | $                                           | 1,195                       | $       | 1,375              









|GS FINANCIAL CORP.                                       |                                                                                      |                      |                                                 |                                           |        
|-------------------------------------------------------- | ------------------------------------------------------------------------------------ | -------------------- | ----------------------------------------------- | ----------------------------------------- | -------
|STATEMENT OF CASH FLOWS                                  |                                                                                      |                      |                                                 |                                           |        
|(Dollars in Thousands)                                   |                                                                                      |                      |                                                 |                                           |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|OPERATING ACTIVITIES                                     |                                                                                      |                      |                                                 |                                           |        
|                                                         | Net Income                                                                           | $                    | 1,195                                           | $                                         | 1,375  
|                                                         | Adjustments to Reconcile Net Income to Net Cash
    Provided by Operating Activities |                      |                                                 |                                           |        
|                                                         |                                                                                      | Depreciation Expense |                                                 | 3                                         |        
|                                                         |                                                                                      |                      | Loss on Sale of Investments                     |                                           | 10     
|                                                         |                                                                                      |                      | Gain on Mortgage-Backed Securities              |                                           | -      
|                                                         |                                                                                      |                      | Equity in Undistributed Earnings of Subsidiary  |                                           | 3,904  
|                                                         |                                                                                      |                      | Amortization of Investment Premium              |                                           | 4      
|                                                         |                                                                                      |                      | Dividend on IMF Fund                            |                                           | (11)   
|                                                         |                                                                                      |                      | Dividend on ARM Fund                            |                                           | (8)    
|                                                         |                                                                                      |                      | Decrease in Accrued Interest Receivable         |                                           | 2      
|                                                         |                                                                                      |                      | Decrease in Dividend Receivable from Subsidiary |                                           | 3,335  
|                                                         |                                                                                      |                      | Decrease in Tax Receivable                      |                                           | 47     
|                                                         |                                                                                      |                      | Deferred Income Tax                             |                                           | 10     
|                                                         |                                                                                      |                      | (Increase) Decrease in Other Assets             |                                           | (8)    
|                                                         |                                                                                      |                      | (Decrease) Increase in Accrued Income Tax       |                                           | (1)    
|                                                         |                                                                                      |                      |                                                 | Net Cash Provided by Operating Activities |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|INVESTING ACTIVITIES                                     |                                                                                      |                      |                                                 |                                           |        
|                                                         | Redemption (Purchase) of IMF Mutual Fund                                             |                      | 200                                             |                                           | 536    
|                                                         | Investment (Redemption) in ARM Mutual Fund                                           |                      | (60)                                            |                                           | 2,809  
|                                                         | Sale of Mortgage-Backed Securities                                                   |                      | -                                               |                                           | -      
|                                                         | Investment in Other Equity Securities                                                |                      | (50)                                            |                                           | -      
|                                                         | Principal Paydowns Note Receivable GS Financial
    ESOP                             |                      | 238                                             |                                           | 215    
|                                                         | Principal Paydowns on Mortgage-Backed Securities
    -                               |                      |                                                 |                                           |        
|                                                         |                                                                                      | Available-for-Sale   |                                                 | 227                                       |        
|                                                         | Investment in Real Estate                                                            |                      | -                                               |                                           | -      
|                                                         |                                                                                      |                      |                                                 | Net Cash Provided by Investing Activities |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|FINANCING ACTIVITIES                                     |                                                                                      |                      |                                                 |                                           |        
|                                                         | Purchase of Treasury Stock                                                           |                      | (8,590)                                         |                                           | (3,654)
|                                                         | Payment of Dividends                                                                 |                      | (763)                                           |                                           | (846)  
|                                                         |                                                                                      |                      |                                                 | Net Cash (Used in) Financing Activities   |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|NET (DECREASE) INCREASE IN CASH
    AND CASH EQUIVALENTS |                                                                                      | (316)                |                                                 | (55)                                      |        
|                                                         |                                                                                      |                      |                                                 |                                           |        
|CASH AND CASH EQUIVALENTS - BEGINNING 
    OF YEAR       |                                                                                      | 570                  |                                                 | 625                                       |        
|CASH AND CASH EQUIVALENTS - END 
    OF YEAR             | $                                                                                    | 254                  | $                                               | 570                                       | $      





Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
AND REPORTS ON





|(a) | Documents filed as part of this Report.
|--- | ---------------------------------------

|(1) | The following financial statements are incorporated by            
|--- | ------------------------------------------------------------------
|    | reference from Item 8:                                            
|    | Report of Independent Auditors                                    
|    | Consolidated Balance Sheets as of December 31, 2000 and 1999      
|    | Consolidated Statements of Income for the Fiscal Periods          
|    | Ended December 31, 2000, 1999 and 1998                            
|    | Consolidated Statements of Changes in Shareholders Equity
    for
|    | the Fiscal Periods Ended December 31, 2000, 1999 and 1998         
|    | Consolidated Statements of Cash Flows for the Fiscal Periods      
|    | Ended December 31, 2000, 1999 and 1998                            
|    | Notes to Consolidated Financial Statements                        

|(2) | All schedules for which provision is made in the applicable                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | accounting regulation of the SEC are omitted because of the absence
    of conditions under which they 
    are required or because the required information is included
    in the consolidated financial statements 
    and related notes thereto.

|(3) | The following exhibits are filed as part of this form 10-K/A,
    and this
|--- | --------------------------------------------------------------------------
|    | list includes the Exhibit Index.                                          









|3.1*    | Articles of Incorporation of GS Financial Corp.                                                                                            
|------- | -------------------------------------------------------------------------------------------------------------------------------------------
|3.2*    | Bylaws of GS Financial Corp.                                                                                                               
|4.1*    | Stock Certificate of GS Financial Corp.                                                                                                    
|10.1**  | GS Financial Corp. Stock Option Plan                                                                                                       
|10.2**  | GS Financial Corp. Recognition and Retention Plan and Trust                                                                                
|.       | Agreement for Employees and Non-Employee Directors                                                                                         
|10.3*   | Employment Agreement among GS Financial Corp. Guaranty Savings
    and                                                                     
|        | Homestead Association and Donald C. Scott Dated February 13,
    1997                                                                      
|10.4*   | Employment Agreement among GS Financial Corp. Guaranty Savings
    and Homestead Association and Bruce A. Scott Dated February 13,
    1997
|13.0*** | 2000 Annual Report to Stockholders                                                                                                         
|21.0    | Subsidiaries of the Registrant - Reference is made to                                                                                      
|        | "Item 1" Business for the required information                                                                                             

* Incorporated herein by reference from the
Registration Statement on Form SB-2 (Registration number 333-18841)
filed by the Registrant with the SEC on December 26, 1996, as
subsequently amended.

** Incorporated herein by reference from the
definitive proxy statement, dated September 16, 1997, filed by
the Registrant with the SEC (Commission File No. 000-22269)

*** Previously filed.





Pursuant to the requirements of Section 13
or 15(d) of the Securities and Exchange Act of 1934, the Registrant
has duly caused this amended report to be signed on its behalf
by the undersigned, thereunto duly authorized.







|May 16, 2001 | By: | /s/ Donald C. Scott
    -------------------------------
    Donald C. Scott
    Chairman of the Board, President
    And Chief Executive Officer
|------------ | --- | ------------------------------------------------------------------------------------------------------------------------------------------------